JAEG 2027: The Income Threshold Rises, and Who Keeps the Lower Limit

Germany's income threshold for private health insurance, the Jahresarbeitsentgeltgrenze (JAEG), also called Versicherungspflichtgrenze, rises sharply on 1 January 2027. That the increase happens is settled law. The exact figure is not: projections put the JAEG 2027 at about €84,600, roughly €7,200 more than the €77,400 of 2026 and one of the steepest single-year rises in two decades. The binding number is published in autumn 2026. Without a safeguard, a large group of privately insured employees earning between those two figures would have been pushed back into public insurance overnight. The safeguard exists. It is called Bestandsschutz, it was written into the same law, and it hinges on one date: 31 December 2026.

Last verified: 13 September 2026.

How much the JAEG rises in 2027

Source: § 6 SGB V and the Sozialversicherungs-Rechengrößenverordnung 2026; 2027 values are the PKV-Verband projection of 2 June 2026.

In a normal year the threshold rises by roughly 2 to 5 percent, in step with average wages. The 2027 increase is about 9 percent because it stacks two rises: the usual wage-linked adjustment, and an extraordinary €3,600 a year that the government added to raise more money for public health insurance. Someone earning €80,000 can choose private cover in 2026; in 2027 the same salary falls short of the general line.

The JAEG is often confused with the contribution ceiling, the Beitragsbemessungsgrenze. The JAEG decides whether you may leave public insurance. The contribution ceiling decides how much of your salary public contributions are charged on. Both rise in 2027, so private cover becomes harder to reach and public cover more expensive at the top end at the same time.

What is already law, and what is still a projection

Two different things get mixed up in the coverage of this change, so it is worth separating them.

Fixed in law. The GKV-Beitragssatzstabilisierungsgesetz, passed by the Bundestag on 10 July 2026, adds an extraordinary €300 a month, €3,600 a year, to both the income threshold and the contribution ceiling from 1 January 2027. The same act creates the Bestandsschutz in § 6 Abs. 8 SGB V. Neither the extra increase nor the grandfathering rule depends on any further decision.

Still a projection. The ordinary part of the increase tracks average wage growth, and that part is fixed each autumn in the Sozialversicherungs-Rechengrößenverordnung. The federal cabinet decides in October, the Bundesrat approves in November, and the values appear in the Federal Law Gazette at the end of November or the beginning of December. Until then every euro amount for 2027 is a forecast, including the ones in this article.

We update this article when the ordinance is published, so treat the euro figures below as the current best estimate and the rules around them as settled.

What Bestandsschutz means for the 2027 threshold

Bestandsschutz translates as grandfathering or protection of an existing status. In German private health insurance the word is used in two different ways. At contract level it describes the rights you keep inside your policy, which we explain in our Bestandsschutz glossary page. This article is about the second meaning, the one that matters right now: protection against the income threshold rising above your salary.

The rule sits in a new paragraph, § 6 Abs. 8 of the Social Code Book V (SGB V), introduced by the GKV-Beitragssatzstabilisierungsgesetz, the public health insurance contribution rate stabilisation act passed by the Bundestag on 10 July 2026. That act adds an extraordinary €300 a month, €3,600 a year to both the income threshold and the contribution ceiling from 1 January 2027, on top of the normal wage-linked adjustment.

The grandfathering clause says, in plain English: employees who on 31 December 2026 are exempt from compulsory public insurance because they exceed the threshold in force on that day, and who hold substitutive private health insurance, are measured in 2027 against the regularly determined threshold without the additional €3,600. The Federal Government fixes that lower figure separately in the same ordinance that sets the general threshold. The DAK employer portal summarises the clause in the same terms.

One misreading to avoid: some insurer pages describe this as "the 2026 threshold continues to apply". The protected line is not frozen at €77,400. It is the 2026 figure adjusted for wage growth, which is how the roughly €81,000 comes about.

The three income thresholds from 2027

Until now Germany had two thresholds, the general one and the special one for people insured privately since 2002. From 2027 there are three.

Source: § 6 SGB V; 2027 figures are the PKV-Verband projection of 2 June 2026, final values follow in the Sozialversicherungs-Rechengrößenverordnung.

Two things stand out. The gap between the general and the grandfathered line is exactly the €3,600 special increase. And the grandfathered line is not frozen: from 2028 it rises each year with average wages, in step with the general line, so the €3,600 distance is meant to stay roughly constant over time.

Who is protected on 31 December 2026, and who is not

The law does not ask whether you earned above the threshold in 2026. It asks about your status on one day. Both conditions have to be met at the same time: you are exempt from compulsory public insurance because your regular gross salary exceeds €77,400, and you are insured with a private health insurer in substitutive cover, meaning a full private tariff, not a top-up policy.

Protected

• Employees already in private health insurance who earn more than €77,400 on 31 December 2026. If your 2027 salary sits between about €81,000 and €84,600, this rule is the reason you stay privately insured without doing anything. Between €77,400 and about €81,000, only the exemption explained further down keeps you private.
• Employees who switch to private cover before the year ends and whose policy is in force on 31 December 2026. A start date of 1 December 2026 is the last one that counts, because private contracts begin on the first of a month.
• New hires who start a job above €77,400 in 2026 and take private cover from day one. A new employment above the threshold is exempt from compulsory insurance immediately, with no waiting until the year ends, so a newcomer starting in October or November can still be protected. Our guide on who qualifies for private health insurance explains the new-entrant rule.

Not protected

• Voluntary members of a public Krankenkasse. Many high earners exceed the threshold but stay in public insurance as freiwillig versichert. They are exempt from compulsory insurance on 31 December 2026, but they are not privately insured, so the second condition fails. If their salary is below about €84,600 on 1 January 2027, they become compulsorily insured again and the private option is gone until their pay clears the full general threshold.
• Employees whose salary crosses €77,400 during 2026 in an existing job. Under § 6 Abs. 4 SGB V, exceeding the threshold in a running employment only ends compulsory insurance at the end of that calendar year, and only if the salary also exceeds the threshold that applies from the next 1 January. For 2027 that is the general line of about €84,600, not €77,400. Anyone in this group is still compulsorily insured on 31 December 2026, so there is nothing to grandfather.
• Anyone who starts a new employment or private cover on or after 1 January 2027. The full €84,600 applies from the first day.
• Self-employed people, freelancers and civil servants who take an employed job in 2027. They were never measured against the threshold, so there is nothing to protect. The full general line of about €84,600, the minimum salary for private health insurance in 2027, applies from the first day of the employment. The same goes for a privately insured part-time employee who is below the threshold today and returns to full time in 2027.
• Self-employed people and freelancers who stay self-employed are outside this rule. The threshold never applied to them, and it still does not.

The deadline is earlier than 31 December

Being privately insured on 31 December 2026 requires a private contract that is already running on that day, and leaving a public Krankenkasse takes time.

Voluntary members cancel their public membership with a notice period of two full calendar months to the end of a month under § 175 Abs. 4 SGB V. A cancellation that reaches the Krankenkasse by 30 September 2026 ends the membership on 30 November 2026, and private cover starts on 1 December 2026. A cancellation in October only takes effect on 31 December, which puts the private start date on 1 January 2027, one day too late for the grandfathering rule.

That gives a practical timeline for anyone who wants the protection:

1. By mid-September 2026: get quotes and complete the health questions. Private insurers need one to three weeks to accept an application.
2. By 30 September 2026: the cancellation must be received by your Krankenkasse. It only becomes effective once you show proof of the new private cover within the notice period.
3. 1 December 2026: the last possible start date for the private contract.
4. 31 December 2026: the reference date the law looks at.

Employees who are already privately insured have no cancellation deadline to meet. If their salary stays above the grandfathered line of about €81,000, the protection applies automatically and payroll applies the lower threshold in 2027. Below that line, the exemption described further down keeps them private. Newcomers starting a job in the last quarter of 2026 do not depend on the 30 September deadline either, because they were never in a Krankenkasse to cancel. See our step-by-step guide on switching from public to private for the paperwork.

Do I have to go back to public health insurance in 2027?

Bestandsschutz protects you against the special increase, not against every future change. If your regular salary drops below the threshold that applies to you, for example about €81,000 for the grandfathered group, you become subject to compulsory public insurance from that moment. When the cause is a threshold rise, that moment is 1 January.

There is a second safety net: the exemption from compulsory insurance, the Befreiung von der Versicherungspflicht under § 8 Abs. 1 Nr. 1 SGB V. The stabilisation act extends it explicitly to the grandfathered line in § 6 Abs. 8. A privately insured employee who falls below that line because it rises with wages can apply for the exemption and keep the private policy.

Can I sign away my return to public insurance in advance?

Not with your private insurer. Compulsory insurance is set by law, so no clause in a private contract and no signed declaration opts you out of it. The one instrument that does is the exemption application to a Krankenkasse, and that application can be filed early.

How the exemption works:

• Where to apply: at the Krankenkasse that would insure you compulsorily, together with proof of your private cover. Without that proof the exemption does not take effect.
• Deadline: within three months of the start of compulsory insurance, so by 31 March 2027 for the 1 January 2027 case. Miss it and you return to the public system.
• Applying in advance: the three months are a deadline, not a waiting period. The Landessozialgericht Berlin-Brandenburg accepted an application filed before compulsory insurance began (judgment of 10 December 2014, L 1 KR 255/13). If you already know your 2027 salary will fall short of the grandfathered line, you can apply before 1 January 2027.
• Effect: backdated to the first day of compulsory insurance, provided you have not used benefits from the Krankenkasse in the meantime. Your employer keeps paying its contribution towards your private premium under § 257 Abs. 2 SGB V.
• Duration: the exemption is irrevocable. It carries over to a new job if the gap between the two employments is no longer than one month. It ends when compulsory insurance arises for a different reason, for example unemployment benefit, and does not revive afterwards.
• Aging reserves: returning to public insurance later forfeits the aging reserves you have built up in your private tariff. They cannot be taken into a Krankenkasse.

Two limits decide whether you qualify:

1. The cause must be the threshold, not your pay. Dropping below the line because of a pay cut does not open this exemption. Part-time work and parental leave have separate exemption rules in § 8 with their own conditions.
2. The extra €3,600 creates no exemption right. The explanatory memorandum to the act says so explicitly. Anyone who becomes compulsorily insured in 2027 only because of the special increase, typically a voluntary Krankenkasse member earning between about €81,000 and €84,600, cannot use the exemption. For that group the only route into private cover is the switch before the 30 September deadline above.

Because the exemption locks you into private cover, it is a decision to take with advice, not on the deadline day.

Two older protections that still apply

The 2027 rule joins two grandfathering provisions that have existed for years.

The 55-plus rule in § 6 Abs. 3a SGB V. Anyone who becomes compulsorily insured after their 55th birthday stays exempt if they were not in public insurance at any point in the previous five years and were exempt from compulsory insurance, self-employed or a civil servant for at least half of that time. For long-standing private customers over 55, a rising threshold changes nothing.

The 2002 cohort in § 6 Abs. 7 SGB V. Employees who were privately insured on 31 December 2002 are measured against the special lower threshold, €69,750 in 2026. The stabilisation act does not add the €3,600 to this line, so it is expected to rise only with wages in 2027, to roughly €72,900 by our projection.

Four cases, four outcomes

The rule is easiest to see with numbers. All 2027 figures are projections.

Source: § 6 Abs. 4, 7 and 8 SGB V and § 8 SGB V; 2027 amounts are projections until the Sozialversicherungs-Rechengrößenverordnung is published.

Look at the second and third rows: same salary, same day, opposite outcomes, decided only by whether a private contract was in force.

Is it worth switching just to secure the Bestandsschutz

No. Private health insurance is a decision for decades, and a deadline is a bad reason to make one. It is a good reason to make the decision now rather than in 2027, if the decision was already on the table.

The people for whom the timing genuinely matters are employees earning between €77,400 and about €84,600 who fit the profile that private cover suits. That means entering up to about age 45 and planning to stay in Germany long term, because aging reserves build from the first month and the advantage grows with every year. The one household where public insurance is usually the better deal is the single-income family with two or more children.

Cost pulls in the same direction. The contribution ceiling in public insurance rises to about €76,500 in 2027, so the maximum public contribution for a high earner climbs to roughly €1,150 a month for health insurance alone with the employer share included, and past €1,300 once long-term care contributions are added. Our cost comparison for high earners puts private premiums against those numbers, and the public vs private guide weighs everything else.

What to do now

• Already privately insured and above about €81,000? Nothing to do. Keep your payslips; your employer applies the grandfathered line in 2027.
• Privately insured and earning €77,400 to about €81,000? Apply for the exemption at a Krankenkasse by 31 March 2027, ideally before 1 January. Without it you return to public insurance.
• Voluntary Krankenkasse member earning €77,400 to €84,600? This is the group that loses the private option in 2027. Run the eligibility check this week and, if private cover fits, cancel by 30 September 2026.
• Starting a job above €77,400 before the end of 2026? Choose private cover from your first day. You do not depend on the 30 September date.
• Salary crossing €77,400 in a job you already have? The grandfathering rule cannot help you. You will need about €84,600 from 1 January 2027, so plan around the general threshold instead. Our salary threshold guide explains what counts as regular income.

We start every case with a free phone consultation, look at your salary, your status on 31 December and your family plans together, and tell you honestly whether the deadline matters for you. Request a free quote or read the wider background in our guide to private health insurance in Germany.