Child disability insurance
An illness or accident in childhood can result in lifelong health impairments. In the worst case, those affected are unable to complete vocational training and later provide for their own living expenses.
With child disability insurance, parents can ensure that their children are financially protected.
Child disability insurance steps in if the child becomes severely disabled due to an accident or illness.
According to the Federal Statistical Office, around 152,000 children and young people under the age of 18 i have a severe disability (degree of disability 50 percent or more) – with more than 14,000 cases added each year.
More than 60 percent of cases of severe disability among children and adolescents are due to an illness.
The scope of disability insurance for children usually includes these types of accidents and illnesses, among others:
Accidents during leisure time or physical education
burns and scalds
Poisoning with consequential damages
cancers (for example, leukemia)
Polio (infantile paralysis)
allergic diseases (for example bronchial asthma)
meningitis (for example after a tick bite)
kidney diseases requiring dialysis
Benefits of the child disability insurance
Child disability insurance generally pays out if the pension office certifies a degree of disability of 50 percent or more. As in the case of a private accident pension, the amount paid out is not adjusted to the degree of disability on a percentage basis, but is always paid out in full.
As a rule, a monthly pension is secured. However, it is usually not possible to agree on a high one-off payment to finance renovation costs of several tens of thousands of euros, for example. For an insured pension of 1,000 euros per month, parents must reckon with an annual premium of around 300 euros.
Tariffs with a one-time payout are often more favorable. The advantage here is that the insurer does not reclaim the amount once paid out should the child lose the severely disabled status again – for example after successful cancer treatment. In this case, payment of the monthly pension would be terminated.
Since children usually have a long life ahead of them and the lump-sum benefit will be used up after a certain time, an annuity should also be covered if possible. This is paid out for life and thus ensures a basic income, even if his parents are no longer able to provide for the child at some point.
In the magazine Finanztest (issue 4/2020), Stiftung Warentest singled out a tariff from Barmenia as a particularly good offer. However, the amount of a lump-sum benefit – for example for necessary renovation measures – is also limited with this tariff: In the event of a claim, a one-time payment of 24 times the monthly pension is paid out in addition to the pension: in the example with a 1,000 euro pension, this means 24,000 euros one-time.
Things to know when taking out the policy
Child disability insurance should be taken out as early as possible. Because if a developmental disorder or a suspected illness occurs in the child, it may no longer be possible to take out the policy.
Depending on the company, the insurance can already be taken out after a few weeks or months of life. The contract period usually ends with the 18th birthday, but depending on the provider, a different age is also possible. In adulthood, it is then advisable to take out occupational disability insurance.
Children’s accident insurance is a good alternative
If it is not possible to take out child disability insurance for financial or health reasons, child accident insurance is a good alternative. This protects the insured child in the event of accidents of all kinds. This is important because the majority of accidents occur during leisure time and at home – where there is no protection through the statutory accident insurance.