With more freedom often comes more responsibility. And by responsibility, I also mean being prepared when you get sick as a freelancer in Germany (not just for your clients, but also for the sake of your own health and well-being).
In today’s guide, I’ll discuss what Krankentagegeld (money you receive while being sick) is, and how to get it as a freelancer so you can feel at ease while planning ahead for the unknown.
Everything you need to know about Krankentagegeld as a freelancer in Germany
Although taking sick leave is encouraged in Germany when you aren’t feeling well, for freelancers it’s much more of a challenge to actually take that time off while not running out of money. If you’re a freelancer in Germany, you may have heard of the concept Krankentagegeld, which is an insurance concept that’s specifically designed for this scenario. We’re going to discuss this option in depth so that you can decide if it’s right for you.
Important German vocabulary related to Krankentagegeld
Before we begin, let’s learn a couple of extremely important health and insurance-related German vocabulary words:
- Krankentagegeld: paid sick leave for freelancers (a payment you directly receive from your insurance, not your clients)
- Berufsunfähig: occupationally disabled
- Krankenversicherung: health insurance
- private Krankenversicherung: private insurance
- gesetzliche Krankenversicherung: public or statutory insurance
- Alterungsrückstellungen: payments to pension savings to keep private insurance affordable as one gets older
- Selbstbeteiligung: deductible (the amount you pay privately in additional to your monthly payment for your insurance)
Now that you’ve got the basics, let’s explore the concept of Krankentagegeld a bit further.
What is Krankentagegeld?
Let me first mention that all German residents including freelancers are legally required to have health insurance.
Krankentagegeld is a type of insurance, also known as a “loss of earnings allowance” or “daily sickness allowance” meant for a short time illness or an accident.
Most insurance policies set the daily limit based on how much you earn. In most cases, if you have public insurance, you’ll receive Krankentagegeld after being sick for 43 days consecutively, and for private insurance, it depends on which options you’ve selected.
The following are also determining factors your insurance options uses to determine how much Krankentagegeld you get:
- Age
- First or fourth day of your illness
- Past illnesses
In addition to the daily allowance, you’ll receive further compensation for the damages, injury, or illness caused, which is especially favourable for freelancers.
Krankentagegeld vs Krankengeld
To clarify something super important: Krankentagegeld is largely for those who are privately insured (freelancers or employees with an additional private insurance), while Krankengeld refers to paid sick leave for employees. They sound similar (and are easily confused) but they are for two different types of scenarios. Basically, even though public insurance does offer options for Krankentagegeld, as an employee in Germany, you get automatically paid sick leave anyways (Krankengeld), but freelancers don’t. So this is why Kranktagegeld is a crucial element of health and wellness security for working as a freelancer in Germany.
Moreover, Krankengeld is what you receive when you’re too sick to work. Employees receive their full salary as Krankengeld for up to 6 weeks. After this, you receive a percentage of your income from your health insurance for up to 72 weeks.
If as a freelancer you would lose your income immediately when you are ill, then you need to book an option with your health insurance for Krankentagegeld.
As I mentioned earlier, freelancers receive Krankentagegeld 43 days after being sick with public insurance, but for private insurance, it depends on your insurance provider. Check with your health insurance provider to get more details on the package you selected when signing up.
As I personally am a freelancer myself, I chose a private insurance package that reduced my 43 day waiting period, because that is a seriously long time in the freelance world to wait for money, so I highly recommend this for other freelancers.
Public vs private insurance as a freelancer
As a freelancer, part of your freedom means selecting between private or public health insurance. In Germany, public insurance is based on your income, whereas private insurance is based on the option you choose.
If you’ve recently relocated to Germany or aren’t a German citizen, private insurance may be the best (or even your only) option. Foreigners living in Germany for more than 90 days are required by law to obtain health insurance.
Here’s an insurance comparison breakdown for freelancers:
Public (gesetzliche) insurance:
- The monthly cost is around 15% of your income, in which 0,9% goes towards sick pay allowance (Krankentagegeld)
- You’re eligible for Krankentagegeld after 43 consecutive days being ill and unable to work with proof from a doctor’s note (Arbeitsunfähigkeitsbescheinigung)
- You can opt in to pay more to receive this money sooner
- You won’t receive more than EUR 90,00 a day if unable to work
Private (Krankenversicherung) Insurance:
- More flexibility on when you receive payment and how much you receive per day
- Can be adjusted to fit your net income
- Might have to undergo a medical risk examination determine pre-existing conditions
- Quicker recovery because of faster appointments, and shorter waiting times
If you’re a freelancer and also a digital nomad, some private insurance companies will also cover you globally, which is a nice perk! Furthermore, private health insurance is tax deductible by up to 80% for anyone who is a freelancer.
If you’re thinking about switching your insurance policy or would like to opt in to Krankentagegeld, make sure to do a thorough analysis to compare your insurance coverage and contribution rate per month.
Lastly, I want to add that if you currently have public insurance as a freelancer, and want to switch to private insurance, you can’t go back to public unless you become an employee. While this does sound scary at first, private insurance will end up becoming a much more financially viable option as your freelance income increases, because the rate stays the same.
How do freelancers get Krankentagegeld?
By paying more towards your health insurance each month, that cushion contributes towards Krankentagegeld. Both private and public insurance require you to prove your illness to receive Krankentagegeld through a doctor’s note (Arbeitsunfähigkeitsbescheinigung). Your health insurance needs to approve that you’ve bypassed the defined waiting period (such as 43 days) and then your Krankentagegeld payments will begin to appear on your bank account.
On another note, you can get disability insurance as an alternative option or as a cushion to fill the gap if you are sick or unable to work for an extreme amount of time.
Whatever the case may be, you always need a plan to coordinate with your clients and with your insurance company to make sure you don’t have to worry if you ever are sick for too long and can’t pay your bills.
