Pension and Disability Insurance Abroad
Germany is bound by an EU regulation and has agreed to a so-called social security agreement with the EU member countries and those of the European Economic Area (EEA). These prevent double insurance from taking place for cross-border occupations. In addition they also ensure that all residence, employment and insurance periods are accounted for, which are required to claim the acquired benefit entitlements. This means: regardless of gainful employment in another country, no compulsory break for the contribution payments occurs, for example for retirement or disability insurance.
Pensionable Age Varies
Although it may at first seem comforting that at least within Europe comparatively consistent rules apply, special attention still needs to be paid. For example someone who has worked in Spain and later returns to Germany, draws his pension for the applicable years worked in Spain. The problem is: in many cases the pension amount may not only differ from the German standard, but so can the respective local pensionable age. The consequence: delays in pension payments. For this reason and not even to mention the current dramatic demographic developments, it makes sense to also establish an additional private pension plan.
Reduced Earning Capacity Protection Limited
Expats should pay special attention to the topics of occupational disability and reduced earning capacity. Even if voluntary contributions to the statutory pension insurance are paid, reduced earning capacity protection is namely linked to this, the reduced earning capacity protection expires during stays abroad of more than three years. The reason: The lawmakers require that during the five years prior to the beginning of the reduced earning capacity three consecutive years of mandatory contributions have been paid for a covered occupation or activity.Retirement Coverage Outside the EUOutside of the EU qualifying periods for pension insurance are only recognized if Germany has signed an agreement for this specific area of social security insurance. There is however a whole list of countries that Germany has no social security agreement with because they possess absolutely no comparable system of social security. Among these are the popular countries of residence United Arab Emirates (UAE), South Africa, Singapore, Russia, Argentina and Brazil. Those who plan extended stays in these non-agreement countries should arrange for private pension and occupational disability insurance.
Articles on Expat News on the subject of retirement abroad: