Do I pay health insurance contributions on my life insurance payout in Germany?
In short
If you took out the life insurance privately and are compulsorily insured as a pensioner, you pay no health insurance contributions on the payout in Germany. A company policy (Direktversicherung) is different: the payout is spread over 120 months and you pay contributions every month after an allowance of EUR 197.75 (2026). Voluntary members of a public health insurer often pay on private payouts too.
Contributions on a company policy under §§ 229 and 226 SGB V, 2026 values.
Example
Typical range
Company policy, payout EUR 30,000
EUR 250 a month, health insurance on EUR 52.25, about EUR 9 a month
Company policy, payout EUR 60,000
EUR 500 a month, health insurance on EUR 302.25, about EUR 53 a month
Company policy, payout EUR 100,000
EUR 833.33 a month, health insurance on EUR 635.58, about EUR 111 a month
Private life insurance, EUR 60,000, compulsory member
EUR 0 health insurance contribution
Calculated with the general rate of 14.6 percent and an additional rate of 2.9 percent as an
example, without long-term care.
Your additional rate depends on your fund.
Reference value 2026: EUR 3,955.
Worked example
Company policy of EUR 60,000, compulsory member
The lump sum is paid at 67. For contributions, the fund spreads it over ten years.
EUR 60,000 divided by 120
EUR 500 a month
Minus 2026 allowance
EUR 302.25 liable
Health insurance at 17.5 percent
about EUR 52.89 a month
Over 120 months
about EUR 6,347
Roughly a tenth of the payout goes to the health insurance fund, plus long-term care insurance on the full EUR 500.
Private or through your employer: that is what counts
The health insurance fund (Krankenkasse) does not look at the product name, but at who took out the policy. Under § 229 of Social Code Book V, occupational pensions count as pension-like income (Versorgungsbezüge) and are subject to contributions. A life insurance you took out and paid for privately as policyholder is not one of them.
A company policy (Direktversicherung) runs through your employer, even if you paid the premiums yourself through salary conversion. It is part of occupational pension provision, and the payout is subject to contributions for members of the statutory pensioners' health insurance (Krankenversicherung der Rentner).
Contract
Compulsory member as pensioner
Voluntary member
Private endowment life insurance
exempt
often liable, ask your fund
Private pension insurance
exempt
often liable, ask your fund
Company policy through the employer
liable, 120 months
liable
Part paid yourself as policyholder after leaving
exempt
ask your fund
Riester contract
exempt
ask your fund
The 1/120 rule for a company policy payout
If an occupational life insurance pays out a lump sum, § 229 treats one hundred and twentieth of it as a monthly pension, for 120 months at most. EUR 60,000 thus becomes EUR 500 a month for ten years, and contributions are due on it.
For health insurance an allowance is deducted, one twentieth of the monthly reference value (Bezugsgröße). In 2026 that is EUR 197.75. The allowance does not apply to long-term care insurance (Pflegeversicherung).
Voluntary members of a public health insurer
If you are not in the pensioners' health insurance but a voluntary member, contributions are based on your overall economic capacity. The payout of a private life insurance may count as well.
Ask your fund in writing before the payout how it treats the life insurance. That avoids a surprise in your contribution notice.
When you pay nothing
If you have private health insurance (PKV), you pay no contributions on any payout, private or occupational, because your premium does not depend on income.
Compulsory members whose pension-like income stays below one twentieth of the reference value pay no health insurance contribution on it either. With large payouts that is rare.
Step by step
Check in the contract who the policyholder is: you or your employer.
For a company policy, check whether you continued paying yourself after leaving.
Ask the insurer for proof of that privately continued part.
As a voluntary member, ask your fund in writing before the payout.
Include the ten years of contributions in your retirement budget.
Checklist
Policyholder checked in the contract
Health insurance status known: compulsory, voluntary or private
Proof of privately continued premiums
Allowance applied in the contribution notice
Common mistakes
Mistaking a company policy for a private life insurance
Not proving the privately continued part after a job change
Not asking the fund in advance as a voluntary member
Questions and answers
Frequently asked
Do I pay contributions on my private life insurance payout?
Not as a compulsory member in retirement.
Voluntary members should ask their fund, because all income may count there.
Does a monthly pension instead of a lump sum help?
Not for a company policy.
A regular occupational pension is also liable, then for life instead of ten years.
Does the allowance apply to long-term care insurance?
No.
The allowance under § 226 SGB V applies only to health insurance.
What about a Riester pension?
Benefits from retirement savings under § 92 of the Income Tax Act are expressly excluded,
so they are exempt.
From what amount are contributions due at all?
When all pension-like income together exceeds one twentieth of the reference value,
