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Scared Germans 'wasting money on insurance'

The Local · 10 Jan 2012, 12:53

Published: 10 Jan 2012 12:53 GMT+01:00

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“Many people have their computers better insured than their own lives,” a spokesman for the consumer group representing insurance customers (BDV) told The Local.

The group said most households could save hundreds of euros a year by looking at their insurance plans and cancelling the pointless ones, Die Welt reported on Tuesday. They should take the opportunity to make sure the important things are better covered.

“Germans are becoming increasingly badly insured, few people give it proper thought,” the spokesman said.

Insurance salesmen are paid commission for each policy they sell, the BVD said, and warned that they often push to sell policies which will benefit them, rather than focussing on the needs of the customer.

One of things people are overspending on is Sterbegeld or funeral cover, a policy which is advertised as leaving a grieving family with a sum of money to cover burial costs.

“Because people are living longer, they are paying more and more money into funeral cover,” a BVD spokeswoman said.

“It is this kind of insurance that plays on people’s fear of death and fear of leaving behind loved ones with nothing to cover costs.”

Yet many of the benefits of funeral cover can be obtained through run-of-the-mill life insurance for much less money.

Other policies which should be considered carefully include wedding cancellation insurance, mobile phone or luggage loss coverage, policies for overnight hospital stays, broken glasses and smashed glass insurance.

“Losing a phone is annoying but it is not worth spending money each year to insure it,” the BVD spokesman said. “It only makes sense to insure items worth more than €500."

“As for wedding cancellation insurance – it hardly ever happens, I have never seen it happen.”

Drivers who insure passengers in their vehicle are also wasting money, the BVD said, as they are covered in the case of an accident, by their own insurance.

BDV chairman Thorsten Rudnik told Die Welt, “lots of people don’t realise that they’re paying too much money for insurance they either don’t need at all or can get for considerably less.”

But the BDV did recommend, however, that certain insurance not be skimped on, such as personal liability insurance as it covers accidents that an individual often could not cover out of their own pocket.

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In 2010, 69.5 percent of Germans bought this kind of coverage according to the German Insurance Association (GDV) – but that leaves nearly a third of the population not covered, the spokesman added.

Personal finance expert Kai Waldmann of the German personal advisory group MLP told the Welt, “the more you stand to lose, the more important it is to be insured.”

“Not being able to replace something from your own means is reason to think about taking out an insurance policy.”

The Local/jcw

The Local (news@thelocal.de)

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Your comments about this article

16:06 January 10, 2012 by iseedaftpeople
>¦quot;Not being able to replace something from your own means is reason to think about taking out an insurance policy.¦quot;

That is absolutely key here. For example, I have a somewhat older car which I still keep on Teilkasko because it still has a replacement value of over 5,000 euros. If something happens to it, somebody steals it or something (God forbid), at least I get money for a new car from the insurance company and won't have to come up with five grand out of my own pocket.

I also have personal liability insurance. I've never had to use it, but although Germany unlike the U.S. isn't known as the country of outlandish lawsuits, it helps me sleep at night because I won't have to worry about somebody suing me out of my life savings.
00:31 January 11, 2012 by hireme.ch
In one word! Germany! The germans are excesively hitting the fan! :):):) BTW - as usual! No hard feelings! None at all! Just proper chain of command! ;);)
01:37 January 11, 2012 by romber58

"it helps you sleep at night".

Exactly so, That is why the fear factor has made insurance companies the wealthiest in the world.

And you will keep paying for your peace of mind and make them even richer coz they have got you by the balls by inculcating fear in you and at the same time suggesting that you might somewhen get more money out of them than you have paid in....
13:13 January 11, 2012 by raandy
Insurance is big here, my wife has an insurance to cover other insurances when they do not cover.

iseedaftpeople maybe they do not have the outlandish law suits , but you just touch someones auto bumper here and see the reaction.
15:15 January 11, 2012 by jmclewis
Germans do not like to take risk. The law of probability be your best friend or worst enemy!
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