If you want to protect your loved ones financially, you should consider life insurance. Although it only pays in the event of the insured person’s death, the protection is comparatively cheap. However, there are enormous price differences among the policies, as Finanztest notes.
Protecting family members financially with term life insurance in the event of your own death does not have to be expensive and makes sense for families, property buyers or single parents. With the offers, however, there are enormous price differences between the individual providers, as Finanztest found when examining 85 policies.
Expensive tariffs cost more than three times as much as the cheap offers in the study. So if you compare prices, you can save hundreds of euros a year. “On the other hand, we did not find any relevant differences in performance. Every tariff in the test offers sufficient protection – even without expensive extras,” says Holger Rohde from Finanztest.
Basically, with term life insurance, the sum insured should be high enough to provide financial security for family members in the event of death. The rule of thumb is to multiply the gross annual income by a factor of three to five. If you have a loan running, you should also calculate this on top of that. For example, if a main earner earns EUR 50,000 per year, the sum insured should be EUR 250,000. If he took out a loan of 25,000 euros, it would be 275,000 euros.
How much the policy costs depends largely on the sum insured: for a model customer (head of department) who was 35 years old when the contract was signed, an sum insured of 450,000 euros was chosen. You get the cheapest protection for around 433 euros a year (Ergo, term life insurance). The model customer, a roofer who chooses an insurance sum of 300,000 euros, gets the cheapest protection for around 233 euros a year (Hannoversche, T1 N10 basis). Since not only the insurance sums of the two model customers differ, but also their professions, the contributions are not comparable.
As a rule, insured persons can only adjust the sum insured if there is a specific reason. The reasons here are usually events such as marriage, the birth of a child or a salary increase. The conditions of this so-called post-insurance guarantee differ depending on the provider, primarily in the type of specific events. Many tariffs now automatically include the supplementary insurance guarantee. With insurers who differentiate between basic and premium tariffs, it is sometimes only included in the more expensive tariff.
It should also be noted that insurance companies often charge premiums for risk factors. This also includes the state of health. The corresponding questionnaire must be filled out truthfully. If ailments are concealed, the insurer can later refuse to pay. In addition, dangerous occupations, age and weight can affect the amount of contributions, as well as if the insured person smokes. According to an earlier study by “Finanztest”, the contributions for them are sometimes three times as high as for non-smokers.
