German Statutory Accident Insurance

Occupational accident insurance was established in Germany by statute in 1884. The agencies in charge of providing this form of insurance are the industrial and agricultural employers' liability funds as well as public sector accident insurance funds, which include both municipal accident insurance association and other accident funds. While employers'liability funds are organized according to industry, the public sector accident insurance funds are the most part organized regionally. (1, 2, 3)

The accident insurance funds govern themselves (self-administration) with equal representation divided between employers, entrepreneurs and employees. The organs of self-administration are the member’s assembly and executive board. This arrangement ensures that the interests of all participants are represented.

The legal basis for occupational accident insurance is formed by the German Social Code, in particular Book VII (SGB VII). (1, 2, 3)

History

The first Reich, known as the Holy Roman Empire of the German Nation, existed from 962 to 1806 until Franz II surrendered the imperial crown. After the end of the Napoleonic wars in 1815 the German Confederation replaced the old Reich. In 1871, the German Empire was founded again, at the end of the Franco-Prussian War. Formerly Chancellor of Prussia, Otto von Bismarck, now Chancellor of the new German Empire, introduced highly progressive welfare legislation by the standards of Europe at the time. (5, 6)

Financing

Statutory occupational accident insurance is among the oldest branches of German social insurance. By contrast with health, long-term care, pension and unemployment insurance, statutory occupational accident insurance is contribution-free for those insured. The costs for comprehensive insurance coverage for prevention, rehabilitation are borne by employers. For public-sector jobs, the federal, state and municipal governments carry the costs.

The contribution rates are determinates according to the pay-as-you-go principle, based on expenditures in prior years. This means that at the end of each fiscal year the statutory accident insurance funds allocate their expenditures among the member companies. The calculation basis is thus formed by actual financing needs, i.e. the allocation amount to be put aside, the wages and salaries of the insured and the hazard class of the particular industry concerned. For the municipal accident insurance associations and accidents funds, the contributions are based on the population, the number of insured persons, or wages and salaries. (1, 2, 3)

Who is insured

Every year some 1,400,000 accidents in the Federal Republic of Germany involving employees who are either working or on their way to or from work. These are joined by around 18,000 cases of recognized occupational illnesses and some 1, 5 million school accidents. For those affected, the consequences often entail wide-ranging changes in their way of life. Restoring these people’s health and, as far as possible, their ability to work is the task of statutory accident insurance.

Every employee and trainee is covered by statutory occupational accident insurance. In industry and agriculture the employer’s liability insurance fund (Berufsgenossenschaften) are responsible for accident insurance. Providing coverage in the public sector are the municipal accident insurance associations (Gemeindeunfallversicherungsverbände) and other public-sector accident funds.

Coverage is provided for accidents at work or school or on the way to or from work or school- as well as for occupational illnesses. (1, 2, 3)

Benefits

Statutory occupational accident insurance has the task of undertaking measures to prevent job-related accidents and illnesses, as well as to protect workers from on-the-job hazards. In cases where occupational accidents or illnesses do occur, accident insurance provides assistance toward restoring the health and working ability of the persons involved and compensation to the insured persons or their persons or their survivors through the provision of cash benefits.

The primary mission of statutory occupational accident insurance according to the legislation is the use all means at its disposal to prevent occupational accidents and illness from occurring in the first place and to minimize potential job-related hazards. The focus is placed on advising companies in all matters having to do with industrial safety and health. This includes providing employers and employees with comprehensive instructions and guideline, as well as international media. The accident insurance agencies also hold free informational, motivational events on the subject of safety at work. (1, 3)

If an insured person has an accident at work or suffers from an occupational illness, statutory occupational accident insurance covers the resulting costs. This means that the insurance fund provides the best possible medical, occupational and social rehabilitation, as well as financial compensation if applicable.

In the event of an occupational accident or illness, statutory occupational accident insurance provides:

• Payment for full medical treatment.
• Occupational integration assistance (for example, retraining).
• Social integration assistance and supplementary assistance.
• Cash benefits to the insured and their surviving independents.

The top priority of the accident insurance fund is to restore the health and ability to work of the insured person Pensions are paid to fund members only when it is not possible to fully restore their ability to work, i.e. for those whose earning capacity is reduced by at least 20 percent. (1, 3)

References

1. German Accident Insurance Organisation
2. Federal association of agricultural Accident Insurance Funds (Bundesverband der landwirtschaftlichen Berufsgenossenschaften)
3. German Social Security
5. German Travel Agency
6. Fact about Germany
7. German International Culture
8. Germany