What type of life insurance is best

Life insurance

Our recommendations for your protection - including tariff comparison (2021)
  • The Life insurance can be concluded in two variants. Depending on the purpose of the insured person, term or endowment insurance is better suited.
  • With a Term life insurance survivors are insured in the event that the insured person dies.
  • A Endowment life insurance pursues two goals: its own old-age provision and the protection of the surviving dependents in the event of death.
  • Our top partners in the life insurance sector include 3 providers in particular
  • The costs a life insurance policy are related to several factors, including but not limited to: the term of the contract, the sum insured and the type of life insurance.

Risk coverage with a life insurance policy

This type of provision is about insuring your own life. If the insured person dies within the term of the contract, the beneficiary receives a one-off payment.

With the capital-forming life insurance, money is also saved for your own retirement provision.

That is why life insurance makes sense


Secure family

In principle, life insurance makes sense if you have relatives who would not be covered in the event of your death. Term life insurance is particularly suitable for young families because they usually have little or no wealth saved. In order to compensate for the economic damage that occurs in the event of the death of the main earner, this type of life insurance can be a good choice, because it pays a large sum immediately on the death of the policyholder, and with relatively low contributions.

retirement provision

If more money is available in old age than the state pension, or if you are self-employed and do not pay into the statutory pension insurance, a capital life insurance can help. This is because you can provide for your old age with a stable investment and provide additional security for your relatives if you should die.

Protection of executives

Business owners can also protect their business with life insurance. For example, a business partner, manager or company can be entered as beneficiaries.

Securing a loan

Banks and other financial institutions now sometimes require life insurance as security. For this purpose, some insurers offer contracts with decreasing insured amounts. This decreases according to the decreasing credit burden. This also makes the insurance premiums cheaper, so that the insured has optimally secured the loan at all times without having to pay too much for it.

Inheritance of the payout

The amount paid out for a life insurance policy is not part of the normal discount, but is considered a gift to the beneficiary. This means that the beneficiary is solely entitled to the sum insured.

Danger: If you have taken out life insurance and your circumstances change e.g. If, for example, you change it through a divorce, remember to change the beneficiary's name accordingly.

Tax advantage

The payment of a life insurance policy must be fully taxed - at least the part that is left over from the settlement of the sum insured and the contributions paid. However, if the contract runs for at least 12 years and the payment is made on the 62nd birthday of the insured person at the earliest, then only half of the amount has to be taxed.

Types of life insurance

Depending on the goal of taking out life insurance, different options come into question.

Term life insurance - provision for survivors

Term life insurance is particularly suitable for protecting families. Because if the main breadwinner dies, this can lead to a considerable burden on family members. The insurance company provides financial help here because the insured sum is paid out if the insured person dies.

In addition to the family, any other person can be registered as a beneficiary. It is also possible to secure a loan or an ongoing loan.

You can read more information about term life insurance here.

Endowment life insurance - coverage times two

In contrast to term life insurance, with endowment life insurance, the agreed sum insured is always paid out. In the event of the insured's death, the relatives receive the sum insured. However, if the insured reaches the payment age agreed in the contract, he will receive the money himself.

This means that endowment life insurance offers both protection for surviving dependents in the event of death and old-age provision for the insured.

Read more about endowment life insurance here.

Life insurance benefits

The benefits differ depending on which option you choose for life insurance. For all life insurance policies, however, a sum of money is paid out to the beneficiary in the event of the insured's death.

Death benefit for relatives

If the insured dies, the relatives receive the guaranteed sum insured as well as the surpluses accumulated up to that point.

Profit sharing

As a rule, the customer receives a share of the insurer's surpluses. However, these are not guaranteed, but depend on the company's success and the development of the markets.

Guaranteed interest

The guaranteed interest rate is currently 0.9 percent. However, insurers can also offer lower interest rates.

Flexible deposit

In the event of financial bottlenecks, the payment method can be changed. An exemption from contributions is also possible for a certain period of time or permanently. However, a permanent exemption from contributions also affects the sum insured in any case.

Guaranteed performance

Thanks to the guaranteed benefits, the insured person has a high level of security and can also calculate his pension in old age.

Participation in price gains with the unit-linked variant

Insured persons who opt for unit-linked life insurance will receive a share in the price gains, but also in the price losses of the insurer.

Flexible contract design

A flexible contract design enables the customer to make provision according to their needs. For example, the contract term can be determined by yourself and is not tied to the start of retirement.

Life insurance can be loaned or sold

Life insurance can be borrowed or sold in times of financial constraints. However, a sale should only be considered in an extreme emergency, as this is usually associated with losses.

Optional: supplementary occupational disability insurance

In addition to life insurance, the insured person can take out supplementary occupational disability insurance, which pays a monthly pension if the insured person can no longer work in his or her profession for health reasons.

Read more about disability insurance here.

Optional: additional accident insurance

As a supplement to life insurance, the insured person can take out additional accident insurance. This pays if the insured has an accident.

You can find more about accident insurance here.

The savings component offers a statutory maximum interest rate of currently 0.9 percent (as of 2019). In addition, the insurance company must distribute part of the profits to the policyholder.

What does a life insurance cost?

The question of what life insurance costs can only be answered on a case-by-case basis. Because the costs depend on several factors and the type of life insurance chosen.

Cost factors in life insurance
  • Age and state of health of the policyholder
  • Term of the contract
  • Sum insured
  • Additional services
  • Administration and distribution costs

The Term life insurance is the cheaper version of life insurance. The amount of the contributions is calculated according to the individual risk and depends, among other things, on age, previous illnesses or risky hobbies. Smokers must z. B. Pay higher contributions.

Since the Endowment life insurance offers both its own protection and that of the beneficiary, the contributions here are comparatively high. The amount also depends largely on the sum insured. In addition, there is the amount of the savings, which can be determined individually. And of course, your own risk also plays a major role here.

Be sure to answer health questions honestly

In any case, the health questions of the life insurer must be answered truthfully and completely. If this does not happen, the insurance can reduce the benefits or refuse to pay them out entirely.

An indication of the seriousness of an insurance company can also be seen in how clearly it is pointed out what consequences false statements can have.

Life insurance put to the test

The corporate strength of life insurers is repeatedly the subject of independent studies. Such tests can serve as a good guide to get an initial overview of the insurance market.