Biometrie insurance: gross contributions drop thanks to higher interest rates!

Biometrie insurance: gross contributions drop thanks to higher interest rates!

On October 7, 2024, it was announced that biometric products such as risk life and occupational disability insurance will be significantly cheaper in the coming year. This gratifying development is the result of a survey by the Insurance Journal. Dr. Guido Bader, board member of the Stuttgart life insurance company, has seen the cause of these contribution reductions in increasing the maximum calculation interest, which will increase from 0.25 to 1.00 percent on January 1, 2025.

Lifting the invoice interest will have an advantageous effect on the entire product design. For example, higher guarantees and increasing guaranteed pension benefits can be promised. These positive effects affect the gross contributions of risk life and occupational disability insurance, since the invoice interest rate has a direct effect on these contributions.

A look at the contribution cuts

The reduced gross contributions do not automatically mean that net contributions will also decrease. While the gross contributions remove, there will also be a reduction in excess participation, which leads to the fact that net contributions remain. Nevertheless, several life insurers plan to maintain the instant surpluses and thus reduce net contributions to these insurance companies to the same extent as the calculated premiums. This is the result of the survey carried out.

dr. Guido Bader further explained that the higher interest rate level on the capital market enables companies to invest their money better than before, which maintains hope for a comparable interest profit as in the old tariffs.

What plans do life insurers have?

Another aspect of the survey was the examination of the transitional regulations for customers who conclude contracts for older and less favorable conditions this year. However, many companies are rather reserved and are not ready to disclose detailed plans. Nevertheless, some concrete changes in the product range were promised for the next year. This includes, for example, the possible resumption of the business with Riester pension insurance, whereby the conditions are still unclear.

For more information about these developments, it is worth taking a look at the next extra sheet of insurance journal, which will be published on October 28th and appears under the title "Get out of the lull: tailwind for life insurance". This can be ordered as a print edition by October 17 and will also be available for download as an e-paper in PDF format from the release date. The issue of the booklet is distributed free of charge in the domestic reference, and subscribers to the insurance journal receive the new issue automatically.

If you want to learn more about this subject area, the article from www.versicherungsjournal.de offers comprehensive information on developments in insurance contributions.