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What if an entrepreneur is overinsured? And what happens if, in the worst case, he finds out that he is even underinsured. The important thing can be separated from the casual, largely without any problems. You can find more on this in my Article in “Enable - Magazin für Unternehmer” by the Financial Times Deutschland, No. 08, published on 08.08.2008.
Just now my article hit in the Finanacial Times appeared - see my post here: - already there are letters to the editor, which in addition to some praise and criticism of the last sentence of my article. I am very happy to comment here.
Which insurance companies need founders?
Business start-ups have no money to give away. You need this to build your company. But many business owners squander it by taking out too many or the wrong insurance policies - only to find out in the worst case that they are even underinsured when it matters. It is therefore worthwhile to make a precise comparison and to obtain offers tailored to the company. This is the only way founders can separate the wheat from the chaff.
- Health insurance is required. However, self-employed people have the choice between statutory and private health insurance. For statutory health insurance, the contribution rate is around 500 € per month. However, founders can push the rate down to about 180 € if they are deprived of money and demonstrably earning less than 3562,50 € a month. And those who are only part-time self-employed (attention: no more than 18 hours a week!) And full-time children educates or makes a training or further education, comes away with about 120 €. As a rule, however, the statutory health insurance is more favorable for women and families. Because even if the private health insurance companies offer just for younger and male members with low contribution rates: This can change later, if the tariff group is closed or the contributions remain unstable. And only then who before the 55. If the year of life becomes an insured person, he may return to the statutory health insurance.
- The state pension insurance is only compulsory for some founders: self-employed persons in teaching, health and care professions, skilled craftsmen and entrepreneurs who receive more than five-sixths of their income from just one customer must pay 19,9% of their income into the statutory pension insurance, provided that their profits exceed 4800 € per year and they do not employ any employees subject to social security contributions. All others can take out voluntary insurance and choose their contributions freely. In the first five years after its founding, there is also the opportunity to earn a claim to Riester support through compulsory insurance. However, private pensions are usually more lucrative. Private annuity policies promise security, but only throw down meager returns and cost high fees. Experts therefore recommend investing in funds, preferably in fee-saving fund savings plans, of course not without risk.
- Occupational disability insurance makes sense. The state disability pension, which is payable when you are no longer able to work as a pensioner before you retire, hardly covers this risk. The critical point in private disability insurance can be found under the term “abstract reference”. If this is stated in the contract, the insurance company checks whether the entrepreneur could still perform a related activity in the event of a disability - regardless of whether there are any jobs. Fortunately, this clause is rarely found in contractual texts.
- Often, the insurance companies also exclude pre-existing conditions from the insurance. Therefore, anyone who does not receive good occupational disability protection has other options: Dread Disease Insurance against individual serious illnesses, a basic skills insurance or a private disability insurance. By contrast, private accident insurance only pays for accidents - worldwide and with low contributions - but statistically, illnesses are much more common than accidents. The professional association, in which self-employed can also secure voluntarily (Caution: in some there is compulsory insurance!) Although pays for occupational diseases, but the catalog is very limited.
- Even relatively new is the fact that self-employed persons can now insure themselves voluntarily relatively cheaply (currently about 21 €) against unemployment, if you were before the foundation also in the state unemployment insurance. Private unemployment insurance, on the other hand, is generally not worthwhile.
- Liability insurance is also important: Business liability covers damage that others cause in the course of business operations - for example, if someone is injured on the company premises. For real financial losses - an order is not completed on time and the customer has financial losses - there is the financial loss liability. The product liability takes over in addition to damage to property and personal injury caused by defective products, even financial losses. For certain professions, such as lawyers or asset managers, a professional liability is even mandatory. And sometimes professional and private liability insurance can be combined favorably.
- Reliable is a legal protection insurance. It does not accept claims for damages or preventative legal advice. For this, usually expensive and unnecessary services must be paid. A cheap alternative for self-employment can be legal advice and protection through a professional association.
- Operating cost, business interruption or bad debt insurance are only worthwhile for larger companies. It can make sense to hedge company investments. Expensive special insurance, such as against glass breakage, storm or fire usually do not pay. Rather, one should complete a total insurance of the most likely risks.
Ladies and Gentlemen,
I've been an insurance broker for 20 years. The statements in the article “direct hit” on the individual insurance lines and types of contract are correct and well-founded. The article thus provides valuable help and guidance for all start-ups. However, a statement in the last paragraph is incorrect! They write: "Anyone looking for help: Insurance consultants cost money, but are independent of insurance brokers." This gives the impression that, in contrast to insurance consultants, insurance brokers are not independent when it comes to selecting and recommending insurers and insurance solutions. The reader is forced to think that with an insurance broker there is a risk that the customer will be dragged over the famous "ledge". Inaccuracy or ignorance? Both would be fatal for the FTD, the reader and real insurance brokers!
Therefore, allow this supplement: The advice of a real insurance broker is independent! The task is to ensure the actual insurance requirements of the client and to protect them as economically as possible. The written insurance brokerage contract documents this. The high-level magistrate's judgment already spoken in the middle of the 80 years is the guideline of every ordinary insurance broker. According to this, the insurance broker is solely responsible for the client's interests, the client. By law and in practice the broker is on the part of the client (§ 93 HGB ff), not on the part of the insurer. For clarity, reliability and trust, the obligation to provide information in accordance with the Insurance Intermediary Act also ensures that since 2Mai this year. According to this, the insurance broker has to inform the prospective buyer of his / her legal position at the first contact.
The information must be documented. From all this comes the independence of the real estate agent. Should the client fear a conflict of interests with the broker from the nature of the remuneration, since the broker is usually paid for a commission by the insurer for his activity, an appropriate fee can be agreed alternatively. Really fair and client-oriented insurance brokers such as FinanzInformationsZentrum GmbH in Essen discuss this with the client in the need analysis.
Inaccuracy or ignorance? In the sense of a good reporting and life support of the FTD this question should not have to be asked any more in the future.
And here a second reader writes:
Ladies and Gentlemen,
Your article. Bull's eye - founders need insurance ... ends with the sentence, unlike insurance brokers, insurance consultants are independent. This is simply wrong. The insurance broker is independent of the company and works on behalf of the client according to the administrator's judgment. The fact that he finances himself with brokerage does not mean that he is dependent. I assume that the insurance agent should be spoken to here. [
To this I would like to say: Of course, insurance brokers also seek an objective and good advice to their customers. And, of course, they are usually self-employed and not employed by insurance companies. If this were not the case, the customers would hardly be able to return.
To this extent, it is of course important for the insurance brokers to advise and act as independently as possible. The fact remains, however, that the insurance broker will receive a commission from the insurance company, and that, in the case of an unmanageable offer, it is presumed that these offers are often based on the offers. The consultation is also free of charge.
Difference between brokers and consultants
The mentioned insurance consultants, on the other hand, are quite expensive, they cost the customers 100 Euro or more per hour, set by the Lawyers Compensation Act. The practice of paying the client a reasonable fee in the event of a conflict of interest was so new to me that the boundaries between the insurance consultant and the insurance broker are obviously blurring.
However, it is regulated by law that insurance brokers may not call themselves insurance brokers and that they can not broker contracts or otherwise act on a commission basis for insurance - and for good reason, to ensure a clear separation for the customer. Incidentally, there are also cases in which insurance brokers illegally call themselves insurance advisors.
Demarcation and transparency
I wanted to create for my readers as clear as possible, to whom he can turn in which case: I recommend in my book also expressly insurance brokers, however, should be my clients always with the commission in the back head. To an expensive insurance consultant, start-ups who have little money will often not go.
However, the last sentence in the FTD article may be more negative in its abbreviated form than I thought it was. I apologize for the misunderstandings. However, I would point out that I often have only a limited line budget available to such a newspaper.
There is more room in a book. The statement that insurance advisors are really independent for me is only an indication that you could get a good advice from brokers - as long as you have the matter with the provision in mind.
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