The Arbeitgeberzuschuss: How Your Employer Pays for Half of Your Premium PKV

One of the most persistent myths about private health insurance in Germany is that it’s entirely out-of-pocket. This is categorically false.

The Legal Framework

Under §257 SGB V, your employer is legally obligated to contribute towards your private health insurance premium. The subsidy amount is calculated as follows:

• Your employer pays 50% of your actual PKV premium
• This is capped at the maximum amount they would have paid into the public system (GKV)
• In 2026, the employer’s maximum GKV contribution is approximately €630 per month

The Mathematical Advantage

Here’s where it gets interesting for high earners. Consider a 30-year-old professional choosing ARAG MedExtra (ME1500):

Component	GKV (Public)	ARAG MedExtra
Total Premium	~€1,261/mo	~€450/mo
Employer Pays	~€630/mo	~€225/mo
Your Cost	~€631/mo	~€225/mo
Coverage Level	Standard	Premium

The result? You pay significantly less out-of-pocket for vastly superior medical coverage. Your employer saves money too, creating a genuine win-win scenario.

What About the No-Claims-Bonus?

ARAG’s premium tariffs include a No-Claims-Bonus (Beitragsrückerstattung). If you don’t submit claims during a calendar year, you receive a cash refund:

• MedExtra: Up to €600 back per year
• MedBest: Up to €900 back per year

Crucially, this refund goes 100% into your pocket — not your employer’s. This effectively reduces your net insurance cost even further.

Family Considerations

Unlike GKV, where non-working spouses and children are covered for free (Familienversicherung), PKV requires individual policies. However, children’s premiums in PKV are typically very affordable (often €100-150/month), and your employer’s subsidy also covers family members up to the maximum cap.

The Bottom Line

The Arbeitgeberzuschuss transforms PKV from a luxury into a strategic financial decision. For most high-earning professionals, switching to ARAG private insurance through the employer subsidy mechanism results in better coverage at equal or lower out-of-pocket costs.