Canceling a life insurance policy: checking the surrender value

Anyone who dissolves a life insurance policy early receives not the premiums paid in, but the surrender value. Especially in the first years, this is often significantly lower than expected. Before canceling, a close look and a comparison with alternatives are therefore worthwhile.

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Your chances of getting your money back

On cancellation of a capital-forming life insurance policy, the insured is entitled to the surrender value (§ 169 VVG). Acquisition and administration costs reduce it, especially in the first years.

Early cancellation often leads to losses. Alternatives such as making the policy premium-free, taking out a loan against it, or selling it on the secondary market can be more favorable. Surrender deductions should also be checked.

What you should do now

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1. Ask for the surrender value
Have the insurer inform you of the current surrender value in writing.
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2. Check alternatives
Compare cancellation with premium exemption, a loan against the policy, or a sale.
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3. Check deductions
Check surrender deductions and whether the cost accounting was correct.
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4. Make a decision
Weigh up whether holding, suspending, or dissolving makes more sense for you.

How to spot the scam

The surrender value is significantly below the premiums paid in.
High surrender deductions are not disclosed.
A cancellation is declared without examining alternatives.

Frequently asked questions

What is the surrender value?

The amount you are paid out on early cancellation of a capital-forming life insurance policy (§ 169 VVG). It does not correspond to the premiums paid in, because acquisition and administration costs as well as any surrender deduction are subtracted.

Why do I get back so little?

Especially in the first years, many premiums are offset with acquisition and distribution costs. That is why the surrender value is low at the start. Only over a longer term does it approach the payments made in.

Are there alternatives to cancellation?

Yes. You can make the insurance premium-free, take out a loan against it, or sell it on the secondary market, which often brings more than cancellation. Which option makes sense depends on the contract, the remaining term, and your need for money.

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General information for self-help, not legal advice (RDG). In case of a high loss or uncertainty: contact a consumer advice center or a lawyer.