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Life Insurance in Germany

According to statistics, each family in Germany has 7 insurance policies on average. As a rule, there are life, personal liability and accident insurance among them. Obligatory types include medical and vehicle insurance. In addition, residents of Germany plan their future. Since there are not enough pensions from the state, many people prepare private pensions in advance and for children there is cash-value insurance to finance future studies at the university.
Life Insurance in Germany
Life Insurance in Germany

One of the most important foundations for an old-age insurance - Kapitallebensversicherung – it is life insurance with accumulation of capital, in which, both in the event of death and at the end of the contract the client receives a cash payment. There are various options offering various ways of capital investment: from the classical to the forms of life insurance tied to funds.

When it comes to protecting the family from unforeseen risk, you can purchase Risikolebensversicherung as the contributions are quite low. If the insured person dies during the term of the contract, the insurance company pays the amount stipulated in the insurance contract to its close relatives. In addition, a lending institution may use Risikolebensversicherung as a pledge to receive its loan back in the event of death of the debtor.

The compulsory types of insurance are typical for Germany. Germany is the birthplace of many types of compulsory insurance. This way compulsory motor third-party liability insurance was first introduced in Germany in 1940.

Compulsory accident insurance is paid by the employer. The insured persons do not pay anything themselves. Everyone having labor, educational or service relations is subject to such insurance under the law. At the same time, insurance coverage is granted regardless of age, gender, marital status or ethnicity. This coverage extends both to work in the workplace or training - on the training place, and while on the way to work or training and back home.

Compensation of damage is provided both in natural form (medical and professional rehabilitation aimed at recovery of injured person’s health and his/ her ability to work) as well as in cash (allowance for temporary disability or a pension in case of permanent disability, while cash payments as compensation for loss of earnings correspond to the earnings of the injured person before he/she sustained an injury or occupational disease, allowing the injured persons to maintain their former standard of living).

Not the fault of the employer, but the very fact of health damage while performing labor duties forms the basis of compensation for harm, which means that the employee does not need to prove the employer's fault, his negligence, in case of damage to health; it is enough to approach the relevant organization.

The cornerstone of Germany's social protection of the population is pension insurance. It provides a guarantee that former employees of enterprises will not get into distressful situation at the end of their labor activity. For all workers and employees, pension insurance is legally due to them. People who are self-employed and those who do not have mandatory insurance because they belong to certain groups of professions can apply for compulsory insurance.

A valuable addition to statutory pension insurance is “enterprise pensions” paid by many firms to their former employees on voluntary basis. Those who do not fall under compulsory insurance, conclude the pension insurance voluntarily.

Today, the pension of almost any pensioner in Germany has different sources of income, most of which are the result of the better judgement and foresight of the person himself. Every German, as a rule, throughout the whole labor activity uses every opportunity to contribute to his future pension or pension of his less fortunate partner using various insurance and accumulation options for this purpose whose reliability is provided to the full by the German financial system. The person who is not able to take care of their own financial security in old age is “selber schuld” (it’s his fault), as the Germans say.

German insurance companies are among the oldest ones in Europe and generally considered to be the most reliable in the world, and Germany is one of world’s leading countries where social and private insurance plays key role in the society.

Sources: 

http://www.trudcontrol.ru/press/publications

http://www.zagranitsa.info/article.php

 

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