Applying for an occupational disability pension: How to proceed


Lerato Khumalo

Occupational disability insurance can help you maintain your usual standard of living. What you need to pay attention to when applying for an occupational disability pension.

A sudden (work-related) accident or a serious illness can tear you out of your working life. Your income disappears and your pension is still a long way off, while the installment loan for your own property, the ETF savings plan and the contributions for liability, accident and car insurance continue.

The statutory disability pension, which is intended for people who are no longer able to work for health reasons, is rarely sufficient to maintain the usual standard of living. It is around 877 euros per month. Occupational disability insurance kicks in if you are no longer able to earn your own income – provided you have taken out one.

Section 172 of the Insurance Contract Act (VVG) stipulates that in the case of occupational disability insurance, the insurer is obliged to provide the agreed benefits for occupational disability that occurs after the start of the insurance.

A person is considered to be occupationally incapable if he or she can no longer perform the job he or she last performed – as it was designed without health problems – as a result of illness, physical injury or simply age – and this is likely to be permanent. Read here what the difference is between occupational incapacity and work incapacity.

If all conditions are met, the occupational disability insurance will pay the contractually agreed monthly disability pension at least until the occupational disability is determined to be medically incapable or the contract term ends. The contract term usually ends when the person starts receiving the statutory pension.

  • Occupational disability insurance is an important precautionary measure in the event that you are temporarily or permanently unable to perform your job for health reasons. It guarantees you a monthly salary – the occupational disability pension.
  • The sooner you take out disability insurance, the better the conditions. You should only cancel disability insurance in an emergency.
  • Occupational disability insurance is risk insurance. Your premiums are not saved. After the insurance period has expired and you do not become occupationally disabled, you will not receive any money back.
  • The BU pension does not replace the statutory pension or a private pension insurance (e.g. Riester or Rürup pension).

The prerequisite for the disability pension is that you have had occupational disability insurance for at least six months and that you have suffered from an illness that requires medical treatment. If you are acutely unable to work, your employer will continue to pay your salary for six weeks. After that, your health insurance company will pay you sick pay for up to 72 weeks.

If an inability to work results in a certified occupational disability that is expected to last longer than six months, insurance companies generally assume that your health condition is not likely to improve any further in the foreseeable future.

Before the insurance pays, various phases must be completed.

  • Determination of occupational disability: To determine occupational incapacity, a certificate must be issued by one or more doctors.
  • Applying to the insurance company: The insurance company needs various documents for the application. These include certificates and reports from treating specialists with information on the degree of occupational disability, the cause, onset and type of illness, as well as a prognosis for the course of the illness. You should also describe your professional activity profile for the last job you performed. The more specific your description is, the better the insurance company can determine which activities were possible when you were healthy.
  • Confidentiality agreement: The so-called (blanket) declaration of release from confidentiality gives the insurance company permission to obtain information from doctors and your health insurance company. The advantage of an individual declaration of consent is that the insurance company requires individual authorization for each piece of information from you.
  • Document review: The insurance company has the application reviewed by an expert and obtains further information. If the insurance company is not convinced, it can commission its own report, but this only happens in about four percent of cases. The decision as to whether the benefit is approved takes an average of three to four months. At the end of the review process, the application for benefits is either accepted or rejected.
  • Reasons for rejection: According to information from the General Association of Insurers, the most common reason for rejection of an application for disability pension is failure to achieve the insured disability level of 51 percent. Other reasons are: no response from the insured (14 percent), violation of contractual reporting obligations (12 percent) and attempted fraud (7 percent).
  • Court proceedings: If legal means are the only way to enforce your claims, then seek advice from a specialist lawyer. According to the Association of Insurers, around 2.2 percent of cases ended up in court after the last survey. Of these, 60 percent ended in a settlement and in 10 percent of cases the insurance customers were found to be right. In 25 percent of all judgments, the insurance companies’ decision was upheld.
  • Payout: As soon as the application has been approved by the insurance company, the disability pension will be paid out.

Whether it’s filling out applications or if the insurer refuses to pay you, get help in good time. Consumer advice centers also offer help. If in doubt, speak to an independent expert. However, you will have to pay any consulting costs yourself. If a legal dispute is looming, get representation from a lawyer specializing in insurance law. These costs are usually covered by legal expenses insurance.

An analysis by Stiftung Warentest of judgments from 2010 to 2016 showed that about half of the court cases were decided in favor of the policyholders.

A look at the statistics shows why it can be important to take out occupational disability insurance. Three categories represent the most common reasons for occupational disability, accounting for almost 72 percent.

Nervous diseases or neurological diseases were the main cause of occupational disability in Germany in 2023, accounting for around 34.5 percent. Typical clinical pictures are stroke, traumatic brain injury, Parkinson’s, multiple sclerosis, Alzheimer’s and migraines.

Enlarge the image
Distribution of causes of occupational disability in Germany in 2023

The second most common cause, at around 20 percent, is diseases of the musculoskeletal system. These include diseases that affect muscles, bones and joints, such as back pain, slipped discs, osteoporosis, arthrosis or gout.

The third most common cause of occupational disability, at around 18 percent, is cancer.

When taking out insurance, make sure that the contract stipulates that your last job is insured if you become unable to work. In technical terms, this means that the insurer waives abstract reference. In this case, the insurance company cannot demand that you take up a different job.

Always communicate with your insurance company in writing about all matters. If a dispute arises in the event of an insurance claim, it can be proven precisely whether all information was provided on time. Make copies of all documents.

The amount of your desired disability pension plays a role in the tariff calculation, as does your age. The higher the disability pension you want and the older you are, the higher the tariff.