Whether European insurance policies are more affordable cannot be generalized; it depends on the specific country, insurance type, and individual needs.
The following analysis uses Germany as an example:
- Social Insurance (Basic Protection)
Health Insurance: Germany has compulsory health insurance, divided into public health insurance (covering approximately 86% of residents) and private health insurance. Public health insurance contributions are 14.6% of pre-tax income (7.3% each for employers and employees), covering basic medical services, but some medications and hospitalizations require out-of-pocket expenses. Private health insurance premiums are priced based on age and health status, offering greater flexibility, but require out-of-pocket expenses and reimbursement.
Pension Insurance: The contribution rate is 18.6% of an employee's monthly pre-tax salary (9.3% each for employers and employees), providing basic living security after retirement.
Unemployment Insurance: The contribution rate is 2.5% (1.25% each for employers and employees), and unemployment benefits are 60%-67% of the employee's previous salary.
- Commercial Insurance (Supplementary Protection)
Third-Party Liability Insurance: Covers compensation for property damage or personal injury caused by accidents. Premiums are low, but coverage is extensive.
Dental Supplementary Insurance: Public health insurance has limited reimbursement, but dental supplementary insurance can cover expenses like fillings and cleanings. The longer you're insured, the higher the reimbursement rate.
Home Contents Insurance: Protects your home and belongings against risks like fire and theft. Premiums are calculated based on the value of the home and the risk level.
- Real-World Case Comparison
Medical Expense Reimbursement: If you suddenly develop acute appendicitis in Germany, public health insurance will cover most expenses, but you'll need to pay for medication and hospitalization. Private health insurance may offer better services, but you'll need to pay upfront.
Accidental Compensation: Third-Party Liability Insurance covers property damage caused by accidents, reducing the risk of high compensation costs.
In summary: European insurance policies offer relatively comprehensive basic coverage, but whether they're cost-effective depends on your income, health status, and needs. For example, those with lower incomes may be better suited to public health insurance, while those who frequently get sick or seek premium care may want to consider private health insurance or supplemental commercial insurance. It is recommended to choose according to your own situation and read the terms carefully.