In a world full of uncertainties, insurance against occupational disability is a security anchor. It protects your income when illness or accident impair your ability to work. This article highlights the crucial role of disability insurance for investors and private savers. We examine its definition and benefits, as well as strategies for choosing the right policy. Each section provides valuable insights to help you make informed decisions and strengthen your financial foundation.
Insurance Against Occupational Disability: Comprehensive Protection for Your Financial Future
An insurance against occupational disability (BU) offers essential protection to ensure financial security in case you can no longer work due to health issues. It ensures that, despite the loss of working capacity, you can maintain your usual income and thus protect your standard of living.
At the heart of occupational disability insurance is the definition of occupational disability itself. This is clearly defined by the Insurance Code (VVG) § 172: it is the inability to exercise the profession previously performed due to illness, injury, or future strain. It is essential that there is an interruption of at least six months, during which the ability to perform the profession is reduced by more than 50%.
The scope of benefits of this coverage is remarkable. A monthly pension is provided to compensate for the loss of income – ideally up to 60% of the gross annual income. This pension, tailored to the needs of the insured, is not offset against other pensions or income and can be vital. It is important to emphasize that this pension continues even if occupational disability persists, often until the statutory retirement age is reached.
A significant difference between occupational disability insurance and other forms of income protection, such as partial disability pensions or insurance for basic abilities, lies in its specific interpretation of the term “occupational disability” and the claims that arise from its individual premium structure. This insurance provides the insured with certainty that other occupations do not necessarily have to be considered as substitutions, as is often the case with state pensions.
To choose the most suitable occupational disability insurance, it is advisable to consult an independent expert. It is important to consider any pre-existing illnesses that may affect acceptance conditions or the amount of the premium. The choice of the waiting period, i.e., the duration before payments begin, also plays an important role, as this factor also determines the amount of monthly premiums.
For those who rely on income from work, insurance against occupational disability offers more than just financial protection; it significantly helps reduce the psychological burden of sudden incapacity to work and creates a stable future perspective.
Strategies for Optimal Adaptation of Your Occupational Disability Insurance
The choice and adaptation of the right occupational disability insurance are crucial to ensuring comprehensive financial protection in times of crisis. Start the process by establishing the desired pension amount, which ideally covers 75-80% of your current net income. Don’t forget to consider all fixed expenses such as rent, loans, and living expenses, as well as any social obligations, to ensure your standard of living remains intact.
A critical point is to consider the duration of benefits and avoid gaps in assistance. Ensure that your occupational disability insurance is valid until the expected retirement age to be adequately protected during the transition. Check that the contract specifies this clearly and that there are flexible renewal options.
Another important aspect is protection against inflation through a contribution dynamic. This ensures that your insurance keeps pace with the cost of living. An annual increase of 3-5% is often appropriate and should also be applied to the pension amount. Moreover, it’s important that your contract contains options for reinsurance guarantees. Uncertainty is part of life, and your insurance should be adaptable to salary variations or family changes without requiring a new health examination.
Pay particular attention to ensuring that your contract waives the so-called “abstract reference.” This means that the insurance should not insist that you can change jobs simply because it could theoretically fit you. Your contract should also include tax benefits. Check if you can deduct the contributions as extraordinary expenses and that they are properly detailed to maximize tax deductibility.
A thorough comparison between providers is essential. Consider services, contributions, and the financial soundness of the providers. Professional and individual advice will help you make the right decision. Also, be sure to carefully answer all health questions and consider any surcharges for pre-existing conditions.
Additionally, many consider purchasing legal protection insurance and daily sickness allowances to supplement their coverage. Ultimately, insurance against occupational disability represents an important protection that must be chosen and adapted carefully and competently.