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Attractive Coverage for the self-employed

Voluntary Unemployment Insurance

Easy read — 7 sections

As a self-employed person, you can voluntarily insure yourself against unemployment — and build a safety net in case work dries up. To be eligible, you need to have been employed for at least 12 months beforehand, or have had an entitlement to ALG 1 (unemployment benefit). The application must be submitted within three months of starting self-employment. The contributions are manageable, but the protection in a crisis is substantial.

March 2, 2026

Contents

Security despite self-employment

Self-employment brings freedom, but also risk. When clients disappear, there is no safety net like for employees. Voluntary unemployment insurance can provide protection here — it pays unemployment benefits if you have to give up your self-employment.

This means more security and room for planning in uncertain times.

What is voluntary Unemployment Insurance?

Voluntary unemployment insurance is coverage through the Federal Employment Agency (Agentur für Arbeit).

You pay a fixed monthly contribution and can receive unemployment benefits (ALG I) in an emergency — just like employees. The prerequisite is that you were previously in a job subject to social insurance contributions and that you submit your application on time.

Then you have a government safety net in case your self-employment ends.

Who can get insured?

Voluntary unemployment insurance does not automatically apply to all self-employed people. You can only take it out if you:

  • were previously employed and thus subject to mandatory insurance,
  • submit the application within 3 months of founding your business,
  • work at least 15 hours per week as self-employed.

Contributions & Benefits

Contributions to voluntary unemployment insurance are approximately between 50 € and 100 € per month, depending on the self-employed person's situation.

After at least 12 months of contribution payments, you are entitled to unemployment benefits (ALG I) if you have to end your self-employment.

The amount of unemployment benefits is based on your previous income from your time as an employee.

Source

How does the Application work?

You submit the application at your local Employment Agency.

Important: It must be received within 3 months of the start of your self-employment, otherwise your entitlement expires.

You will need:

  • Proof of the start of your self-employment (e.g. trade registration or tax registration),
  • Proof of your previous employment subject to social insurance contributions,
  • The form "Application for voluntary continued insurance."

After reviewing the application, the Employment Agency sends you a decision and you pay the contributions monthly by bank transfer or SEPA direct debit.

Advantages & Disadvantages

Let's look at the pros and cons of voluntary unemployment insurance.

Advantages:

  • You are entitled to unemployment benefits (ALG I) if you have to end your self-employment.
  • You remain in the statutory unemployment insurance system and can more easily switch back to employment later.
  • During the start-up phase, a reduced contribution rate applies — you only pay half.

Disadvantages:

  • The contribution is fixed — regardless of your income level.
  • The benefit is based on your previous employee salary, not your current revenue.
  • Ordinary cancellation on your part is only possible after 5 years.

Alternatives & Tips

There are hardly any real alternatives to voluntary unemployment insurance — but you can try to cushion your risk in other ways:

  • Build reserves: The most flexible solution. If you save regularly, you can bridge dry spells yourself.
  • Networks & client care: Stable orders and good relationships are the best prevention against unemployment.

→ Only voluntary unemployment insurance offers a legal entitlement to unemployment benefits. All other measures can stabilize you financially, but do not replace this protection.

Sources

  1. [1]Source – Hinweis Alv Ba013509

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