US EditionKarlsruhe - Riester-Rente: Bundesgerichtshof Tilts Central Clause in Insurance Contracts
7 Articles
7 Articles
Can an insurance company shorten the Riester pension if people live longer or their investments run worse than expected? No, the Federal Court of Justice has now decided. The decision could affect around one million contracts.
The Bundesgerichtshof has declared a central clause in Riester contracts to be ineffective.
In order to prevent old age poverty, millions of Riester contracts have been concluded. However, the model is more than controversial. Not only because of the horrendous costs for savers. Because even so many clauses of the policies are collected in court. So again today.
The Federal Court of Justice overturns a clause in fund-linked pension contracts, which allows insurance at low interest rates to cut unilaterally. Hundreds of thousands of contracts are likely to be affected.
The BGH has decided in favour of Riester customers. Insurers must not unilaterally reduce the pension factor. The verdict has a signal effect.
Reading time 2 minutesInsurers are not allowed to grant themselves the unilateral right to adjust the pensions below in the case of fund-linked Riester pension contracts alone. While it is permissible that general insurance conditions in case of a deteriorating earnings situation provide for a reduction of the so-called pension factor and thus a reduction of the later expected Riester pension, the Federal Court of Justice (BGH) in Karlsruhe (Az.…
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