01
Traditional policy
Guaranteed minimum interest of up to 1.0% on the savings part plus bonuses. Predictable, but with low expected returns.
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Private pensions in Germany: a guide for people who did not grow up with the system
Germany splits retirement saving into three tax layers, and the layer you choose decides what you can deduct today, what is taxed later and whether you can take the money with you. For expats the key question is not which insurer, but how long you plan to stay and where you will retire.
The question almost everyone asks first
Should I take out a German private pension if I might leave Germany?
Only if the product still works for you abroad. A Rürup contract cannot be cashed in, but it keeps paying a lifelong pension wherever you live, taxed according to the tax treaty. Riester subsidies generally have to be paid back if you move outside the EU or EEA. An unsubsidised private pension policy is the most portable: you can keep it, make it paid-up or cash it in. If your stay is short, the high early costs of any policy weigh heavily.
The three layers: what is different from a UK pension or a US 401(k)
Layer one is the statutory pension plus the Rürup pension (Basisrente). Rürup contributions are fully deductible up to €30,826 in 2026, but the money is locked until retirement, cannot be withdrawn as a lump sum and is paid out only as a lifelong annuity. There is no equivalent of a 25% tax-free lump sum.
Layer two covers company pensions and Riester, both subsidised and taxed in full on payout. Layer three is the unsubsidised private pension policy: paid from taxed income, but the later annuity is taxed only on a small 'income portion'. If you take a lump sum instead, half of the gain is taxable, provided the contract ran at least 12 years and you are at least 62.
Unlike in the UK or US, most German private pensions are sold as insurance contracts, not as investment accounts. That brings a lifelong payout guarantee, but also acquisition costs that are spread over the first five years. We advise on insurance contracts, not on individual funds or securities.
Riester ends, a new subsidised scheme starts in 2027
The Bundestag passed the retirement savings reform on 27 March 2026 and the Bundesrat approved it on 8 May 2026. From 1 January 2027 no new Riester contracts can be signed. Existing contracts continue with their current subsidies and may switch to the new system.
The new scheme pays 50 cents per euro saved up to €360, then 25 cents per euro up to €1,800, so up to €540 a year, plus up to €300 per child. Savers choose between a retirement investment account without guarantee, products with an 80% or 100% contribution guarantee, and a standard product with costs capped at 1.0% a year. For the first time, self-employed people will also be eligible.
The planned 'Frühstart-Rente', €10 a month from the state for every child aged 6 to 18, was approved by the cabinet on 12 August 2026 but is still going through parliament as of September 2026. It is not law yet.
Leaving Germany: what happens to your contract
An unsubsidised policy stays valid when you move. Most insurers pay the annuity to a foreign bank account, and taxation follows the double tax treaty between Germany and your new country. Rürup pensions also continue, but you can never cash them in, so check the tax rules of the country where you plan to retire.
Riester is the trap: if you move outside the EU or EEA and are no longer eligible, the subsidies and tax benefits normally have to be repaid. US citizens should also get US tax advice before buying a fund-linked policy, because the IRS may treat German funds inside the contract differently from German tax law.
What is covered
- Lifelong monthly annuity from the agreed start date
- Option to take a lump sum instead of an annuity, for unsubsidised policies
- Guaranteed annuity factor or minimum pension, depending on the plan
- Guaranteed payment period that continues to your heirs
- Return of contributions or fund value if you die before retirement, if agreed
- Automatic yearly contribution increases without new health questions
- Top-ups and partial withdrawals on flexible plans
- Contribution waiver if you become unable to work, if included
What is not covered
- No guaranteed return on the fund part
- No lump sum from a Rürup contract, ever
- No early access to Rürup money, not even in hardship
- No automatic inflation adjustment unless a rising annuity is agreed
- Profit participation is not guaranteed and can be cut
- No long-term care benefit without a separate add-on
Who needs it
- Expats planning to stay in Germany long term, ideally until retirement
- Self-employed people and freelancers outside the statutory pension, for whom Rürup is the most tax-efficient option
- High earners who want to cut their German tax bill now
- Anyone worried about outliving their savings
Who can do without
- People planning to leave Germany within a few years, because early costs eat most of the value
- Anyone without an emergency fund of three months' expenses
- Anyone still paying off expensive consumer debt
Wheel of misfortune
Spin the wheel of bad luck
Six things that really happen. The wheel picks yours and shows who pays.
Cost:
Budget policy
Strong policy
See all six cases
- Retiring to Spain, annuity paid there, monthly annuity to a foreign account, fees possible. Budget policy: pays in part, Strong policy: pays. Most insurers pay abroad on request, some with charges. Strong policies pay to foreign accounts without extra fees.
- Riester saver moves to Canada, subsidies and tax relief usually clawed back. Budget policy: does not pay, Strong policy: does not pay. Leaving the EU or EEA usually ends Riester eligibility, whatever the provider. That is why expats should think twice before signing one.
- Insurer lowers the annuity factor, less pension per €10,000 of capital, for life. Budget policy: pays in part, Strong policy: pays. If the factor is only stated, the insurer may cut it when life expectancy rises. If it is fully guaranteed, it stays.
- Parental leave, no contributions, a gap in savings, plus losses if you cancel early. Budget policy: pays in part, Strong policy: pays. Basic policies only offer a paid-up option with lower guarantees. Strong ones allow a break of up to 24 months at no cost.
- Market crash just before retirement, the fund value can drop sharply within months. Budget policy: does not pay, Strong policy: pays in part. No fund-linked policy guarantees prices. Strong ones shift gradually into safer assets in the final years.
- Dies two years into retirement, the unused capital, often five or six figures. Budget policy: pays in part, Strong policy: pays. With a five-year guaranteed period, heirs receive only the remaining three years. Strong policies refund the remaining capital.
What it costs
You choose the contribution yourself, so there is no fixed premium to compare. What matters are costs, guarantees and the annuity factor. The 'effective costs' figure in the product information sheet shows how many percentage points the costs take off your return each year.
What drives the premium
- Acquisition costs, spread over the first five years
- Ongoing administration and fund charges
- Level of guarantee on contributions or annuity
- Time until the pension starts
- Annuity factor and guaranteed payment period
- Add-ons such as a contribution waiver on disability
We give no contribution benchmarks because you set the contribution. Costs, annuity factor and guarantees are binding only in the quote. Tax figures as of 2026.
The policy levels on the market
02
Unit-linked with partial guarantee
Part of the money secures a minimum benefit, the rest goes into funds. A compromise between security and return.
03
Unit-linked without guarantee
Everything is invested in funds and moves with the market. Best suited to long terms, ideally with a guaranteed annuity factor.
How to recognise a good policy
| Criterion | Minimum standard | Strong policy | Why it matters |
|---|---|---|---|
| Effective costs | shown in the product information sheet | below 1% a year over the whole term | One percentage point of costs adds up to five figures over 30 years. |
| Annuity factor | stated, but insurer may lower it | fully guaranteed | Only a guaranteed factor tells you what your savings will buy. |
| Payment abroad | on request | annuity paid to foreign accounts without extra fees | Expats often retire outside Germany. |
| Flexibility | paid-up option | top-ups, withdrawals, flexible start date | Careers and countries change over 30 years. |
| Contribution holiday | none | up to 24 months at no cost | A career break or move should not destroy the contract. |
| Guaranteed payment period | 5 years | selectable up to age 85 or with refund of the remaining capital | Otherwise the capital is lost if you die soon after retirement. |
| Documents in English | German only | English summaries and service | You should understand what you sign. |
Insurers on the German market
Almost every German life insurer sells private pensions. The differences lie in costs, annuity factors and fund choice rather than in the brand. This list is a market overview and says nothing about which insurers we work with.
| Insurer | Background |
|---|---|
| Allianz | life insurer of the Allianz group, sold through agents and brokers |
| Alte Leipziger | mutual insurer with a strong broker channel |
| Stuttgarter | mutual insurer, mainly through brokers |
| LV 1871 | Munich-based mutual, broker distribution |
| Volkswohl Bund | mutual insurer, broker distribution |
| HDI | part of the Talanx group, brokers and agents |
| Swiss Life | part of the Swiss Life group, sold via financial advisers and brokers |
| Debeka | mutual with its own sales force, does not work with brokers |
| Hannoversche | direct insurer of the VHV group, mainly online |
From the BaFin register
77
77 insurers supervised by BaFin, the German regulator, are licensed for this class of insurance. (Lebensversicherer)
Show all 77 names from the register
- ACM Lebensversicherung AG
- AGER Lebensversicherung AG
- Aioi Nissay Dowa Life Insurance of Europe Aktiengesellschaft
- Allianz Lebensversicherungs-Aktiengesellschaft
- Alte Leipziger Lebensversicherung auf Gegenseitigkeit
- Athora Lebensversicherung Aktiengesellschaft
- AXA Lebensversicherung Aktiengesellschaft
- Baloise Lebensversicherung Aktiengesellschaft Deutschland
- Bayern-Versicherung Lebensversicherung Aktiengesellschaft
- BL die Bayerische Lebensversicherung AG
- BY die Bayerische Vorsorge Lebensversicherung a.G.
- Concordia oeco Lebensversicherungs-AG
- Condor Lebensversicherungs-Aktiengesellschaft
- Continentale Lebensversicherung AG
- Cosmos Lebensversicherungs-Aktiengesellschaft
- Credit Life AG
- Debeka Lebensversicherungsverein auf Gegenseitigkeit Sitz Koblenz am Rhein
- Delta Direkt Lebensversicherung Aktiengesellschaft München
- Deutsche Lebensversicherungs-Aktiengesellschaft
- Deutsche Ärzteversicherung Aktiengesellschaft
- DEVK Allgemeine Lebensversicherungs-Aktiengesellschaft
- DEVK Deutsche Eisenbahn Versicherung Lebensversicherungsverein a.G. Betriebliche Sozialeinrichtung der Deutschen Bahn
- Dialog Lebensversicherungs-Aktiengesellschaft
- DIREKTE LEBEN Versicherung AG
- Dortmunder Lebensversicherung AG
- Entis Lebensversicherung AG
- ERGO Lebensversicherung Aktiengesellschaft
- ERGO Vorsorge Lebensversicherung Aktiengesellschaft
- EUROPA Lebensversicherung Aktiengesellschaft
- Frankfurt Münchener Lebensversicherung AG
- Frankfurter Lebensversicherung AG
- Generali Deutschland Lebensversicherung AG
- Gothaer Lebensversicherung Aktiengesellschaft
- Hannoversche Lebensversicherung AG
- HanseMerkur Lebensversicherung AG
- HDI Lebensversicherung AG
- HDI Vorsorge Lebensversicherung AG
- Heidelberger Lebensversicherung AG
- HELVETIA schweizerische Lebensversicherungs-Aktiengesellschaft
- HUK-COBURG-Lebensversicherung AG
- IDEAL Lebensversicherung a.G.
- INTER Lebensversicherung AG
- InterRisk Lebensversicherungs-AG Vienna Insurance Group.
- Itzehoer Lebensversicherungs-Aktiengesellschaft
- Lebensversicherung von 1871 auf Gegenseitigkeit München
- Lifestyle Protection Lebensversicherung AG
- LPV Lebensversicherung AG
- LVM Lebensversicherungs-AG
- Mecklenburgische Lebensversicherungs-Aktiengesellschaft
- myLife Lebensversicherung AG
- MÜNCHENER VEREIN Lebensversicherung AG
- neue leben Lebensversicherung Aktiengesellschaft
- NÜRNBERGER Lebensversicherung Aktiengesellschaft
- Protektor Lebensversicherungs-AG
- Provinzial Lebensversicherung Aktiengesellschaft
- Provinzial Lebensversicherung Hannover
- Proxalto Lebensversicherung Aktiengesellschaft c/o Viridium Group GmbH & Co. KG
- R + V Lebensversicherung a.G.
- R + V LEBENSVERSICHERUNG AKTIENGESELLSCHAFT
- SIGNAL IDUNA Lebensversicherung a. G.
- SIGNAL IDUNA Lebensversicherung AG
- Skandia Lebensversicherung Aktiengesellschaft
- Sparkassen-Versicherung Sachsen Lebensversicherung Aktiengesellschaft
- Stuttgarter Lebensversicherung a.G.
- SV SparkassenVersicherung Lebensversicherung Aktiengesellschaft
- Swiss Life Lebensversicherung SE
- uniVersa Lebensversicherung a.G.
- VEREINIGTE POSTVERSICHERUNG VVaG
- Versicherer im Raum der Kirchen Lebensversicherung AG
- Volkswohl-Bund Lebensversicherung a.G.
- VPV Lebensversicherungs-Aktiengesellschaft
- WGV-Lebensversicherung AG
- WWK Lebensversicherung auf Gegenseitigkeit
- Württembergische Lebensversicherung Aktiengesellschaft
- Zurich Deutscher Herold Lebensversicherung Aktiengesellschaft
- Zurich Life Legacy Versicherung AG (Deutschland)
- Öffentliche Lebensversicherung Sachsen-Anhalt
Source: BaFin company database, retrieved 18 September 2026. Insurers from other EU countries selling through a branch or without a German office are not included.
Legal basis and sources
Products and add-ons
Private pension policy (layer 3)
Unsubsidised and flexible. Can be cancelled, borrowed against and inherited. Annuity taxed only on the income portion.
Rürup pension (Basisrente)
Contributions fully deductible up to €30,826 in 2026. Lifelong annuity only, no cash-in, no lump sum.
Riester pension
State subsidy of €175 a year plus child bonuses, for people in the statutory pension scheme. New contracts only until 31 December 2026.
New subsidised retirement saving from 2027
Investment account, guaranteed products or a low-cost standard product, with up to €540 subsidy a year plus child bonuses.
Immediate annuity
A lump sum, for example from selling a property, turned straight into a lifelong pension.
Myth or truth
True or false?
Five things people say about this insurance. Guess first, then see the answer.
German private pensions are protected if the insurer goes bust.
This is true.
Largely true. German life insurers must belong to a statutory protection fund run by Protektor Lebensversicherungs-AG, which takes over the contracts. Guaranteed benefits can be cut by up to 5 percent.
You lose your German state pension if you leave Germany.
This is false.
False. Entitlements you have earned stay yours and can be paid abroad once you qualify, usually after five years including other EU periods. Some non-EU citizens with less can apply to have their own contributions refunded after 24 months abroad.
The monthly pension shown in a German quote is guaranteed.
This is false.
False. Only the amount explicitly labelled as guaranteed is promised, and it is usually much smaller. The headline figure is an example based on an assumed return.
Delaying the start of your annuity raises it noticeably.
This is true.
True. The capital grows for longer and has to last for fewer years, both of which lift the monthly amount. Strong policies let you choose the start within a window.
A German private pension annuity is taxed at your full income tax rate.
This is false.
False for unsubsidised policies. Only a portion of each payment counts as taxable income, and that portion shrinks the later you start. Rürup and Riester pensions are the ones taxed almost in full.
Common mistakes
- Buying a Rürup contract without knowing where you will retire
- Signing a Riester contract and then moving outside the EU
- Cancelling in year two or three instead of making the policy paid-up
- Taking the projected pension in the offer for a guarantee
- Ignoring US tax rules as a US citizen
- Comparing monthly contributions instead of costs and annuity factors
Questions and answers
Frequently asked
Can I take my German private pension with me when I leave?
Yes, an unsubsidised policy and a Rürup pension stay valid and can be paid abroad. Taxation then follows the double tax treaty. Riester is different: subsidies usually have to be repaid if you move outside the EU or EEA.
Is a Rürup pension like a UK SIPP?
Only partly. Both give tax relief on contributions, but a Rürup pension can never be cashed in or taken as a lump sum. It pays only a lifelong annuity, and only a spouse or children with child benefit can receive a survivor's pension.
Can I still sign a Riester contract in 2026?
Yes, until 31 December 2026. You need to be in the statutory pension scheme or a civil servant, or married to someone who is. From 2027 the new subsidised scheme replaces Riester for new savers.
How is a private pension taxed in Germany?
For an unsubsidised policy only the income portion is taxed, 17% of the annuity if it starts at 67. Rürup and Riester pensions are taxed on payout almost in full, because contributions were tax-relieved.
Can I get my contributions back if I cancel?
You get the surrender value, which is much lower than your contributions in the early years because acquisition costs are charged over the first five years. Making the policy paid-up is usually better. Rürup contracts cannot be cancelled at all.
Do I have to pay health insurance contributions on a private pension?
If you are a compulsory member of statutory health insurance as a pensioner, private pensions are contribution-free. Voluntary members of statutory health insurance pay contributions on all income, including private pensions.
Can my children benefit from the new state pension saving for kids?
The Frühstart-Rente is planned: €10 a month from the state for children aged 6 to 18. The cabinet approved the draft on 12 August 2026, but parliament had not voted as of September 2026, so no accounts can be opened yet.
Can I have my German pension documents in English?
The legally binding documents are almost always in German. Some insurers provide English summaries or service in English. We explain the contract terms in English before you sign.
How long can I cancel a new contract?
You can withdraw within 30 days of receiving the complete contract documents, without giving a reason. After that, only cancellation or a paid-up policy is possible.
NAMMERT insurance broker
Request quotes for Private pension
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We will be in touch within one working day. If it is urgent: +49 3375 29 12 77.
Often goes with it
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Do I need occupational disability insurance if I have just moved to Germany?
How much term life cover do I need in Germany?
Should I choose public or private health insurance in Germany?
Do I need private long-term care insurance in Germany?
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