What is a work incapacity insurance?
The public work incapacity insurance exists in Germany since 2001. It pays employees and those who pay into the public pension insurance a pension when their capacity to work has been reduced because of their health.
The basic requirement is that the person can only work for less than six hours on a daily basis for any foreseeable future at any kind of occupation.
There are additional conditions and especially getting the full pension is very difficult (see infobox). Furthermore, the pension is often insufficient to maintain the standard of living, since it usually is about 30 — 40% of the gross income.
The private work incapacity insurance aims to increase the state pension. It is an additional building block for the loss of income. For most people, 30% of their salary is not enough to maintain their current standard of living.
Self-employed people and freelancers are usually not covered by the public work incapacity insurance and often use the private version as basic protection.
What are the benefits of a work incapacity insurance?
Similar to the public work incapacity insurance, the private counterpart also pays a monthly pension. The amount that is paid is determined by you, which naturally determines your premiums.
The main condition for receiving the pension, is that due to health reasons, you are not able to work a pre-determined number of hours per day. Usually it is between three and six hours per day.
However, it does not matter that you cannot work in your profession, you don’t have to be able to work in any profession.
The private work incapacity insurance comes in three variations:
- As an independent insurance,
- as a supplementary insurance for life insurances or
- as supplementary insurance for life annuity or annuity insurance.
Who should get a work incapacity insurance?
Average age when being diagnosed with a work incapacity or occupational disability 
The private work incapacity insurance and the occupational disability insurance ultimately have the same goal: enabling you to keep your standard of living if you cannot work anymore.
The work incapacity insurance is hereby often regarded as the smaller version of the occupational disability insurance. The benefits are smaller but it also costs significantly less.
Therefore, it is a very interesting option for people who cannot get an occupational disability insurance.
Additionally, it is very attractive for self-employed people and freelancers. That is due to the fact that they are usually not covered by the public work incapacity insurance.
Moreover, people who are employed in so called “risk jobs” often turn to the private work incapacity insurance. Many times, it is their only option to ensure that they receive an additional pension if they cannot work anymore.
Every employee should have an insurance in case he or she cannot work anymore. The private work incapacity insurance represents the minimum safety net and is highly recommended you cannot get the occupational disability insurance.
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Links to independent sources
Stiftung Warentest: https://www.test.de/Berufsunfaehigkeit-So-sichern-Sie-Ihr-Arbeitseinkommen-ab-5028848–0/