The employer subsidy (Arbeitgeberzuschuss) is the share of your health insurance contributions that your employer pays, even though you pay the contributions yourself. It matters most if you are not compulsorily insured because of the annual earnings threshold. This guide explains the requirements and shows an example calculation.
Short answer: If you are an employee and are exempt from compulsory insurance only because of the annual earnings threshold, you may be entitled to an employer subsidy towards your health insurance under certain conditions (§ 257(1) and (2) SGB V). With private health insurance, the subsidy is at most half of your contribution. As of October 2026, source: gesetze-im-internet.de, accessed 26 October 2026.
The most important points
- The subsidy is based on the employer share that would be due if you were compulsorily insured (§ 257(1) SGB V).
- With private health insurance, your employer pays at most half of your contribution (§ 257(2) SGB V).
- You are only entitled if you are an employee and are exempt from compulsory insurance because of the annual earnings threshold.
- The private insurance company must meet additional requirements under § 257(2a) SGB V.
- Self-employed people do not receive this subsidy.
When are you entitled to an employer subsidy?
The entitlement is closely linked to the annual earnings threshold. The glossary entry on the annual earnings threshold explains it. Typically, the following points must all be met:
- You are an employee, meaning a worker or a salaried employee.
- You are exempt from compulsory insurance only because you exceed the annual earnings threshold.
- With private insurance, you can claim services of the same type for yourself and your dependants.
- Your insurer meets the requirements of § 257(2a) SGB V, for example regarding the type of business and the basic tariff (Basistarif).
How is the subsidy calculated with private insurance?
The calculation follows a fixed scheme. The example below uses assumptions for 2026.
| Step | What to do | Example (assumption) |
|---|---|---|
| 1 | Half the contribution rate plus half the additional contribution | (14.6 + 2.9) divided by 2 = 8.75 percent |
| 2 | Assessment basis: your earnings, up to the contribution assessment ceiling | EUR 7,000, capped at EUR 5,812.50 |
| 3 | Employer share: basis times rate | EUR 5,812.50 times 8.75 percent = EUR 508.59 |
| 4 | Cap: at most half of your contribution | Assumption: private premium of EUR 400, half = EUR 200 |
| 5 | Employer subsidy | EUR 200 a month |
The calculation only covers the health insurance part. For the additional contribution, the average rate of 2.9 percent for 2026 is used (as of January 2026, GKV-Spitzenverband). For private insurance, § 257(2) SGB V applies this average rate, not the rate of an individual health insurer.
What does the subsidy mean for choosing your insurance?
The subsidy lowers your own contribution, but it does not cover it in full. Whether private insurance is worthwhile depends on age, health, tariff and life plans. The subsidy also ends with the employment relationship. If you are unsure, you can ask for a personal assessment, as offered by Academycon (in German).
Frequently asked questions
Do I also get the subsidy with voluntary statutory insurance?
Yes, if you are exempt from compulsory insurance because of the annual earnings threshold and remain voluntarily insured in statutory insurance. Your employer then pays the employer share that would be due under compulsory insurance (§ 257(1) SGB V).
Do I have to apply for the subsidy?
You provide your employer with the necessary documents. With private insurance, your insurance company issues a certificate every three years confirming that the supervisory authority has verified the requirements. You present this certificate to your employer (§ 257(2a) SGB V).
Does the subsidy also apply to long-term care insurance?
For private long-term care insurance (private Pflegeversicherung) there is a separate rule in Book XI of the German Social Code (§ 61 SGB XI). Clarify the exact requirements with your employer.
Do self-employed people receive this subsidy?
No. The subsidy is tied to an employment relationship. Self-employed people therefore pay their contributions in full themselves.
What should you do now?
- Check whether you are exempt from compulsory insurance only because of the annual earnings threshold.
- Ask your employer to confirm in writing whether it pays a subsidy and how much.
- Have your insurance company issue the certificate every three years and give it to your employer.
- Compare contribution and subsidy before you switch, and include services, age and health in your decision.
Related reading
- Glossary: Annual Earnings Threshold Explained
- Glossary: Contribution Assessment Ceiling
- Switching to Private Health Insurance at Career Start
- Career Start After University: Your Guide to the First Job
Sources: § 257 SGB V, gesetze-im-internet.de (accessed 26 October 2026); § 241 SGB V, gesetze-im-internet.de (accessed 26 October 2026); GKV-Spitzenverband, fact sheet on reference values 2026, as of 1 January 2026.
Last updated: October 2026. This guide is general information and not individual advice.
