Life insurance under pressure: high costs and high cancellation quotas!

Life insurance under pressure: high costs and high cancellation quotas!

A new analysis by the Institute for Financial Economy at the Ludwigshafen University of Applied Sciences shows that some German life insurers are dropping a lot of money from their customers. The study deals with the enormous differences in operating costs among the 16 largest life insurers who are active in new business in 2023. While some providers of how WWK live and Nuremberg live, over 18 percent of the contributions for operating costs are used, costs for direct insurers such as Cosmos Life and Market Funeral Alliance are significantly lower. Professor Hermann Weinmann, who created the study, emphasizes the big differences that can occur in customer contributions.

The Federal Financial Supervisory Authority (BAFIN) already expressed concerns about the high cost structure and urgently demands improvements from several providers. Bafin Executive Director Julia Vienna said that life insurance should be sufficient for customers' claims, which in many cases is not the case. The focus is in particular on the amount of the effective costs that the annual return. A certain part of the life insurance contracts has very high cancellation rates, which indicates that some products may not be suitable for the target group. Bafin is currently reviewing 13 life insurers and is ready to take measures against grievances. You can find more information on www.merkur.de .