Compulsory insurance

Mandatory insurance is an insurance policy, the financial statements are required by law. This is in many countries, for example in motor vehicle liability insurance, professional liability insurance, and especially in the social security of the case. A distinction is made - usually state - insurance schemes with statutory compulsory membership, especially in the social security obligations, as well as the requirement to have private insurance. In Germany this is selected mainly for insurance companies that serve the protection of third parties, as is the case for motor vehicle liability insurance, professional liability insurance and hunting liability insurance. This protection is however made ​​in the statutory insurance against accidents at work also in the way the state compulsory membership of a professional association.

The counterpart of the insurance is the Voluntary insurance for people who are not subject to compulsory insurance.

Liability insurance and contractual freedom

A statutory liability insurance is contrary to the principle of freedom of contract, by virtue of Article 2, Paragraph 1 of the Basic Law is a fundamental right in Germany. The restriction of freedom of contract by an insurance therefore requires special justification. Reasons are eg the protection of third parties (for liability insurance ), the protection of health or consumer protection. From liberals Compulsory insurance is partly criticized as paternalistic.

Often associated with a mandatory insurance an obligation to contract for insurance companies. Historically insurance were often associated with insurance monopolies.

History

Historically, the fire insurance companies are the first -party insurance. In the 17-18. Century emerged in many areas of legal regulations, the fire insurance made ​​compulsory. The Bismarckian social legislation introduced in 1883 first -party insurance in the social security a (health insurance). The first liability insurance in 1923 normalized by the Aviation Act.

Types of insurance

Social security

Social Germany

Compulsory insurance in the German social insurance is the unemployment insurance ( SGB III), health insurance (SGB V), the pension insurance (SGB VI), the nursing care insurance (SGB XI) and accident insurance (SGB VII).

Mandatory insurance is regulated differently in their scope. So there are minimum limits that exclude petty offenses: The marginal employment pursuant to § 8 SGB IV ( " 450 - Euro - Jobs " ) is exempt from compulsory insurance under the statutory scheme, even though the employer has to pay a lump-sum contribution to health insurance ( § 249b SGB V). Insurance claims this does not occur.

In contrast, the statutory pension insurance is basically insurance compulsory since 1 January 2013. While the employer ( in household occupations ) or 15 % dissipates a lump-sum contribution amounting to 5 % (for commercial activities ) of the remuneration of employees increased its contribution to the full set of ( § 168, paragraph 1. 1b, 1c SGB VI). There arise pension entitlements as a "normal" insurable employment. However, the employee has the right to be exempted from this obligation of insurance (§ 6 para 1b SGB VI). Nothing changes ( § 172 para 3, 3a SGB VI) on the obligation of the employer to transfer contributions to the statutory pension insurance, and their height. In the pension then only supplements to earnings points are determined ( § 76b SGB VI), which also leads to a waiting time performance contribute to a small extent ( § 52 § 2 SGB VI).

The unemployment again, no contributions are levied at marginal employment and also acquire any claims.

Next there is the income threshold, which is updated annually. She is in health insurance and long term care lower than in unemployment and in the pension system.

The health insurance has the peculiarity that high earners are exempt from insurance if their pay exceeds the annual income limit. You then need to volunteer health insurance in the statutory health insurance or private.

As far as the self-employed are not already subject to compulsory insurance (§ 2 SGB VI), they can in the German statutory pension insurance at the request of compulsory insurance ( § 4 section 2 SGB VI) or voluntary contributions to pay ( § 7 paragraph 1 of the SGB VI).

Social Austria

Under insurance is meant as regulated by the Austrian Social Insurance Law emergence of a social obligation as well as the statutory membership of a particular social security institutions.

Example: Someone starts a paid employment in Vienna and earned above the de minimis limit. Thus it is subject to social insurance; responsible for him is the Vienna Health Insurance (KV), the Pension Insurance Fund ( PV ) and the AUVA (UV).

Social Insurance Switzerland

The Swiss social security knows comprehensive insurance obligations. It is designed differently from the German Social Security largely as a citizen of insurance or insurance for all workers (including self-employed ). The compulsory insurance is more extensive than in Germany.

Liability Insurance

Liability insurance is required by law in a number of cases:

  • Motor vehicle liability insurance, in most European countries
  • Professional liability insurance ( compulsory for lawyers ( professional liability insurance for lawyers), notaries, architects and engineers, chartered accountants ( = auditor and tax consultant) and doctors)
  • Public liability insurance for certain industries and businesses
  • Hunting liability insurance as a condition for the grant of a hunting license
  • Keepers liability insurance

Travel Law

In the German Travel Law since 1994 the peculiarity that providers of vacation packages with the travel insurance certificate must provide evidence of insurance against consequences of insolvency.

Fire insurance

In the past, the fire insurance was compulsory insurance. This duty was abolished in Germany.

Economic evaluation

Basically insurance from an economic point of view should be considered critical because they act effizienzvermindernd under the conditions of an ideal market. The policyholder is obliged to take out insurance, although its benefit from any other use of this money would be applied later. However, since the conditions of an ideal market is not the case in reality, there are a number of economic arguments for compulsory insurance.

From an economic perspective, a compulsory insurance can be justified if the insurance in question is a merit good. According to this argument, the insured would underestimate the needs of pensions systematically and therefore would obtain too low a retirement without a pension insurance. In addition, insurance can prevent moral hazard and adverse selection. This applies to social security in the case of small income but also in liability insurance. In case of damage here the cost would not be borne by the insured ( because they can not), but from the social welfare office or the injured.

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