The Germans and the topic of saving – a connection that is always assumed to us German citizens as an “innate quality”. It may sound hard and somewhat exaggerated in the eyes of one or the other, but it is ultimately always confirmed by appropriate statistics Let’s take a look at saving in the form of a life insurance policy: several 100 billion euros are stashed into over 75 million life insurance policies – a sum that is made up of savings and corresponding interest payments. The catch on the whole thing: whoever believes, however in an emergency – that is, before life insurance expires – to be able to dispose of his savings, which is wrong! Well, that shouldn’t be new to most people and so one tends to use the bank’s classic installment loan when money is needed. But that doesn’t have to be the case, because you can very well dispose of the money in life insurance before it expires namely “indirectly” – the key word is: policy loans! What is behind it? We explain it …
Life insurance as a source of money: early termination or loan?
It is undisputed that there are many ways of bridging an increased financial need based on whatever – be it by means of the classic bank loan, borrowing money from acquaintances, loaning your own valuables or selling your own life insurance. All more or less effective means when it comes to serving a financial emergency.
The issue of “selling life insurance” in particular is used very frequently, especially with larger sums. However, many people accept two extremely negative points:
- Loss of return
- Loss of insurance coverage
Also note: If life insurance also includes occupational disability insurance, this also no longer exists. A new conclusion of this important protection is then usually much more expensive or no longer possible.
But all of this can be maintained or “saved” if you simply “lend” your life insurance to a specialist provider. The whole topic is then called policy loan and represents a real alternative to the actually unnecessary sale of life insurance. With a policy loan, the insurance protection for borrowers is fully preserved. In addition, the policy is released again after the loan has been repaid in full. A policy loan also does not require a minimum contribution period (years in which you have already paid in amounts), no minimum surrender value and no minimum remaining term. The interest conditions are also presented transparently and honestly: Depending on what you prefer as a potential borrower, the interest is paid monthly or at the end of the term. Interest and repayment may not exceed the current guaranteed surrender value of the insurance. The sums of the current surrender value of the insurance can be found in the regular notifications from the insurance company.
The following points generally apply to policy loans:
- Lendable life and pension insurance
- Capital life insurance up to 100% of the surrender value
- Unit-linked LV up to 60% of the surrender value
- Without credit record request or credit check
- Special repayments possible
- Can also be implemented for non-contributory courses
Extremely quick credit decision and availability
Providers specializing in policy loans
They have placed so-called online loan calculators on their websites, which immediately show the installment amount depending on the selected term and loan amount. If the potential borrower agrees to the general conditions for a policy loan, the application form can be completed and sent online. A credit decision is usually made within a few minutes. Proof of income or the like usually plays no role in the credit decision.
credit record theme
Anyone who is worried about not being granted such a loan because of a debited credit record has completely unjustified reason to do so, because: Since the loan is secured by an insurance policy, the bank that provides the policy loan does not take any risks. For this reason, the policy loan can also be applied for without a regular income. The bank neither does a credit record query, nor is the loan entered in credit record.
Conclusion: Loaning life insurance offers a whole range of advantages and is a more than sensible and low-interest option for conventional installment loans from your own house bank. In addition, the whole thing is credit record-free and not associated with a loss of insurance coverage. Recommended!