Term life insurance
A term life insurance is a personal insurance , the beneficiary in the contract persons paying the agreed sum in case of death of the insured person. Often referred to as survivor protection, it is often used to provide financial security for family members. Business partners, companies, associations, etc. can also be designated as beneficiaries. In 2014 there were around 7.6 million term life insurance policies in Germany.
functionality
During the agreed term of a term life insurance policy, the policyholder pays the insurance company a one-off amount right at the start or a monthly premium. This in turn insures that in the event of the death of the insured person, the agreed sum insured will be paid to the beneficiaries in the insurance contract . In order to provide financial compensation for the loss of the main breadwinner of a family or a business partner, experts recommend an insurance amount of three to five times the gross annual income.
The amount of the insurance premiums is calculated using various criteria that can influence the risk of a payment. These include:
- Age when taking out insurance
- Contract term
- Occupational risks
- level of education
- Leisure risks (e.g. dangerous hobbies like skydiving)
- Health risks (e.g. previous illnesses, smokers)
- Amount of the sum insured
Until the introduction of the unisex tariffs on December 21, 2012, gender also had a major influence on the contribution amount. Up until this point in time, men had to pay significantly higher contributions due to their lower life expectancy.
Forms of term life insurance
In addition to the classic protection or preferential treatment for a natural or legal person, there are two other variants of term life insurance.
Associated term life insurance
With the associated term life insurance, two people can protect each other. The insurance then pays out precisely in those cases in which the other person dies. This can be particularly useful in families with two main breadwinners. Business partners can also protect themselves well with the associated term life insurance. The great advantage of this couple tariff is the lower fees. The disadvantage here, however, is that the sum insured is only paid out once if both policyholders die at the same time. This means, for example, that if both parents die, the children only receive money from the insurance company once.
Payment protection insurance
The residual debt insurance secures the repayment of a loan (a residual debt). Since this residual debt decreases over time through repayment, the insurance contributions often also decrease. Some banks even require this form of term life insurance to take out a loan.
Statistical Numbers
- 16% of men do not reach the age of 65
- 8% of households say they have term life insurance
- In 2012 there were a total of 10.5 million current contracts
- In 2012, diseases of the circulatory system were the most common cause of death in Germany with 349,217 deaths
Web links
- Association of insured persons : Leaflet on term life insurance
- Gabler Wirtschaftslexikon: Definition of term life insurance
Individual evidence
- ↑ GDV: 7.6 million Germans rely on term life insurance. Retrieved September 24, 2015 .
- ↑ Handelsblatt, January 11, 2013
- ↑ statista.com, 2014: "Which insurance policies have been taken out personally or in your name in your household?"
- ↑ Causes of death in Germany. Federal Statistical Office, accessed on September 24, 2014 .