the Federal Finance Minister, Olaf Scholz (SPD), the completion of commissions in life insurance are still too high and will miss a lid. This is the so-called draft, the Scholz-Department on Wednesday has submitted – usually the entry in a legislative procedure. It was announced the move in the previous summer, now it’s time to implement. Therefore, the commissions for the insurance agent should not represent more than 2.5 percent of the gross amount of contributions. Included are the commissions flowing to the insurance of employees, as long as a contract of insurance. In exceptional cases, Scholz wants to allow an upper limit of four percent, and then if to compensate for the customer, certain qualitative characteristics are met. Including a cheap cancellation agreement falls, for example.
reason for capping the commissions view in the Ministry of Finance that the 2014 approved German life insurance reform act has not brought enough pressure on the insurance industry to reduce their Commission payments. Lush remuneration for insurance representatives can be considered as a cause for failed discussions-that is, for Insurance contracts, over and above the wishes and needs of customers. Such Disincentives, and the related unjustified high costs will restrict Scholz through the ceiling.
Also in the case of credit insurance, Scholz limits
the same debt, insurance, banks often enter into in connection with loans, and loans also applies to the rest. With these default risks to be covered. Here, too, the commissions flow from the insurance companies to the lending banks. According to the Ministry of Finance, these commissions are a sometimes significantly higher cost to the consumer as in the case of life insurance. You can make up to ten percent of the loan amount. Here, too, Scholz wants to move a lid at 2.5 percent.
However, the action of the Federal Minister for Finance, in the case of life insurance companies is manageable – at least with the major providers. According to the draft, the total sales commissions at the seven giants of the sector, the share of more than 50 percent of the market, an average of 3.28 percent for the contribution sum. The amount in the financial statements immediately due and payable (and therefore the biggest incentive for insurance representatives), now, in the large insurance companies, about 2.5 percent. In Scholz-Department holding the cap, therefore, is acceptable.
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In the industry associations. “We reject the Commission cover to continue,” said the General Association of the German insurance industry, the “considerable need for improvement”. “The regulations for residual debt insurance, in addition to shooting over the target,” a spokesman said. The Federal Association of German insurance (IUC) is also dissatisfied. “Whether this solution is constitutionally possible, we will check,“ announced IUC-President Michael H. Heinz. He criticised the fact that there is still a connection between pay and false incentives will seen. The rate of Complaints about insurance and reinsurance intermediaries to the insurance Ombudsman was recently as low as never been before. “It must not come to a policy intervention and, ultimately, to the detriment of the quality of the advice and of the important social and political responsibility of all insurance intermediaries,” said Heinz.
