Private health insurance in retirement: Optimize costs, secure benefits
17 Jun 2025
4
Minutes
Katrin Straub
CEO at nextsure
Retirement is approaching and you're wondering what will happen with your private health insurance? Many fear rising premiums, but with the right planning, you'll remain optimally insured even in old age. Discover the adjustments you can make and how to optimally arrange your private health insurance for retirement.
The topic in brief and concise terms
Pensioners can apply for a subsidy for private health insurance from the pension insurance provider, which reduces the contribution burden.
Due to provision for old age and the elimination of certain premium components (e.g. sickness benefit, statutory surcharge), the private health insurance premium can remain stable or even decrease in old age.
An internal tariff change according to Paragraph 204 VVG or the conclusion of a premium relief tariff are effective means of actively reducing contributions in retirement.
Understanding and managing the development of private health insurance premiums in retirement
Many insured individuals are concerned about the cost of their private health insurance in retirement. Generally, certain contribution components are eliminated upon retirement, which can initially have a relieving effect. For instance, the contribution for daily sickness benefits is no longer applicable since you are no longer employed. The statutory surcharge of ten percent, which is levied until the age of 60 to build up retirement reserves, also lapses at this point.
These retirement reserves, which you have accumulated over the years, help to keep the contributions stable in old age. The private health insurance calculates contributions in such a way that they remain affordable throughout their entire duration, including in old age. However, general cost increases in the healthcare sector can lead to contribution adjustments. It is a common misconception that private health insurance becomes unaffordable in old age; often, contribution increases in public health insurance have been even higher in percentage terms. An overview of private health insurance costs helps in gaining perspective. The exact development depends on your individual tariff and the reserves you have accumulated.
Optimally utilise subsidies for private health insurance for pensioners
As a pensioner with private health insurance, you are entitled to a subsidy from your pension insurance provider. This subsidy must be actively applied for, ideally together with your pension application. The amount of the subsidy is based on the general contribution rate of the statutory health insurance (currently 14.6 percent) and the average additional contribution (currently 1.7 percent), in relation to your statutory pension. The pension insurance covers half of this, so currently 8.15 percent of your pension benefits (as of June 2024).
It is important that the subsidy does not exceed half of your actual private health insurance premium. For a pension of, for instance, 1,500 euros, you could receive a subsidy of up to 122.25 euros per month. This subsidy is an important component in making private health insurance affordable during retirement. Inform yourself early about the tax deductibility of your contributions. You can obtain the exact calculation and necessary forms from your pension insurance provider.
Actively Reduce Contributions: Strategies for Retirement
There are several ways to actively influence and reduce your private health insurance contributions in retirement. Early planning is often crucial for success. You can already prepare during your working life.
Here are four effective measures:
Change of tariff within the company: According to Paragraph 204 VVG, you have the right at any time to switch to another tariff within your insurance with similar coverage. Often, there are newer tariffs with lower contributions but comparable services. Your accrued age reserves are fully preserved in the process.
Contribution relief tariffs: Many insurers offer special tariffs to relieve contributions in old age. During your working years, you pay an additional savings contribution, which then reduces your regular private health insurance contributions in retirement. Such a tariff can reduce the monthly burden by several hundred euros.
Adjustment of the deductible: Increasing your deductible can noticeably reduce your monthly contribution. Consider whether you can bear higher one-off costs in the event of illness to save continuously. An adjustment of the deductible by 250 euros can often already result in a saving of 50 euros monthly.
Benefit adjustments: Critically review your insurance coverage. Do you really still need all the selected additional benefits in full extent during retirement? Sometimes adjustments can be made here that positively impact the contribution without jeopardizing the core coverage.
These options help manage the obligation to have health insurance in old age financially well. Individual advice can show you which strategy is best suited for your situation.
Expert knowledge: Legal frameworks and pitfalls
Private health insurance in retirement is subject to specific legal regulations. A key point is the independence of contributions from income in old age, unlike in the statutory health insurance (GKV). This means that additional income from capital assets or rentals does not affect your private health insurance (PKV) contribution. Note that a switch back to statutory health insurance for retirees over the age of 55 is only possible in very rare exceptional cases. Therefore, thorough planning of PKV financing in retirement is essential.
Our expert tip: Carefully examine the possibility of a tariff change under Paragraph 204 of the Insurance Contract Act (VVG). This paragraph guarantees you the right to switch to another tariff with the same insurer, offering equivalent coverage, with full credit given to your age-related provisions. This can often lead to savings of up to 30% without having to forgo important benefits. Also, pay attention to the conditions of so-called standard or basic tariffs, which offer a legally defined minimum protection with capped contributions. These could be an option if the contributions in your current tariff become too high. A calculation of your private pension can provide additional planning security.
Long-term planning: The importance of pension provisions
Age provisions are the cornerstone of premium calculation in private health insurance for retirement. From the start of your contract, part of your premium is saved and earns interest to cushion the rising healthcare costs as you age. Until the age of 60, you also pay a statutory surcharge of ten per cent, which is added to these provisions. From the age of 65, these accumulated funds are used to mitigate or prevent premium increases. The earlier you join private health insurance, the more time you have to build a solid cushion of age provisions.
The amount of age provisions accumulated can reach a five-figure sum for a 65-year-old who joined at the age of 35. This sum acts as a buffer against rising healthcare expenses. It is important to understand that premium adjustments in private health insurance are not primarily caused by your individual ageing, but by medical advancements and the general cost development in the healthcare system. Therefore, a solid foundation of age provisions is your best protection for stable premiums in retirement. Compare this with the three pillars of retirement provision.
Recommendations for a Worry-Free Future
To optimally prepare your private health insurance for retirement, you should take proactive steps. A comprehensive analysis of your current situation is the first step. Use the remaining time until you retire to make corrections if necessary.
Specific steps for you:
Review existing contract: Analyze your current private health insurance plan regarding benefits and contribution amount. Does it still meet your needs in old age?
Seek advice: Talk to an independent insurance expert about your options. A professional assessment can help you make the right decisions.
Apply for a subsidy: Remember to apply for the health insurance subsidy from your pension provider in good time. This can reduce your monthly burden by up to 8.15 percent of your pension.
Review contribution relief tariffs: If not already done and time permits, consider taking out a contribution relief tariff. Even a monthly savings amount of 100 euros can mean relief of 200 euros or more in old age.
Evaluate tariff change options: Inquire with your insurer about more affordable tariffs with comparable protection (internal tariff change according to Paragraph 204 of the VVG).
Through these measures, you can ensure that your private health insurance remains affordable even in retirement, allowing you to continue enjoying high-quality health protection. Also consider the general context of retiree health insurance. Now request an individual risk analysis: Have your insurance situation checked for free and receive concrete optimization proposals.
More useful links
Bundesgesundheitsministerium offers comprehensive information on private health insurance in Germany.
Statistisches Bundesamt (Destatis) publishes press releases with relevant statistical data, which may also concern health insurance.
Deutsche Rentenversicherung provides detailed information on health and long-term care insurance for pensioners.
Verband der Privaten Krankenversicherung (PKV) explains the sustainable financing of private health insurance.
Bundesgesundheitsministerium offers a definition of the basic tariff in private health insurance.
Verband der Privaten Krankenversicherung (PKV) provides statistics and data on private health insurance in its figures portal.
Bundesministerium für Arbeit und Soziales provides information on pensions and retirement planning.
FAQ
How do contributions to private health insurance develop in retirement?
Premiums may be adjusted due to general cost increases in the healthcare sector. However, age reserves and the elimination of premium components (e.g., daily sickness allowance, statutory surcharge from age 60) have a stabilizing or reducing effect. A blanket statement is difficult as it strongly depends on the tariff and individual conditions.
What options do I have to reduce my private health insurance contributions as a pensioner?
You can consider changing your plan within your insurance company (Paragraph 204 VVG), choose a higher deductible, cancel coverage components you no longer need, or benefit from a premium reduction plan if arranged early on.
How much is the pension insurance subsidy for private health insurance for retirees?
The allowance is currently 8.15 percent of your statutory gross pension (as of June 2024). However, it is limited to a maximum of half of your actual private health insurance contributions and must be applied for.
Is the contribution for sick pay automatically omitted in retirement?
Yes, with retirement and the associated loss of earned income, the need for an income protection insurance usually ends, and the corresponding contribution portion is no longer required.
What are age reserves and how do they affect my pension contribution?
Age reserves are savings components accumulated during the term of your contract to offset the typically increasing healthcare costs associated with aging. They help keep your premiums stable in retirement.
Is it possible to switch from private health insurance to statutory health insurance at retirement age?
For individuals over 55 years, a return to public health insurance is only possible under very strict and rarely met conditions. Returning is the exception.
