Choosing the Correct Death Insurance (Sterbeversicherung)

coffins of African migrants in Lampedusa

We discussed various possibilities of handling your burial before the time comes in the “Preparing for the End” article and among the options was the death Insurance.

Death insurance what some companies here call Sterbegeldversicherung or Sterbeversichrung, and most Kenyan banks or insurance companies call the “Bury me home” product, allows you to sign up for an insurance policy in which a certain amount of money is paid out to your relatives once you pass on.

How does it work?

In Germany you can sign up for one worth 4000 – 10,000 euros. In Kenya many banks/insurance companies offer one for 1 – 10 million Kenya shillings and covers family members.

The monthly costs are quite low and is independent of your social status here in Germany (whether or not you have a job, you can sign up for one without the Sozialamt coming after you). In cases where the company you sign up the policy with goes bankrupt, then Sozialamt pays out €3500. This is a pro for those who sign up for a policy in Germany.

In Germany, the insurance has a specific time period. So when you sign up for one, you can decide until when you would like to pay for the insurance you can either pick a specific time period e.g. after 25 years or when you reach a certain age, usually 65 or 85. If by the time you turn 65 or 85 or after the 25 years, you still haven’t died, then you stop paying your monthly fees and just wait for your death which is when the amount shall be paid out.

 

Example

A 58 year old signs up for a policy worth €7500 and pays a monthly fee of €35 (approx. €420 a year).

In Kenya, for the KSh. 1 million cover, you pay a monthly fee of KSh. 209. It covers a father, mother and 2 children. A million for each of the adults and half a million for each child. (You can listen to the discussion on the bury me home cover below, from 45:00)

 

So what do you need to check for?

Here are some criteria shared by the consumer initiative, Aeternitas.

  • Choose a policy worth anything between 1000 – 12,500 euros
  • Open to people aged between 18 and 80 years
  • Allows clients to sign up without a medical examination
  • No waiting period before the pay out after death. Most will pay out within 12months after death. (The Kenyan ones pay out within 24hours)
  • Double pay out in cases of a death in an accident
  • “Staffelung” ceases in cases of death
  • Fixed payment period to avoid over payment into the insurance
  • Exemption from further payments for anyone in the Pflegestufe III
  • No binding contract of the policy with funeral homes, stone masons or cemetery care takers
  • Assistance Services in bereavement
  • Relatively low monthly premiums
  • Consider ease of getting the pay out. If you have relatives in Germany, they can follow up after your demise, but if all your relatives are outside Germany and can hardly communicate in German, it would be helpful to consider a plan with a Kenyan bank/insurance company.

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