Petition proves: Pension commitment is not insolvency-proof but seizable:
Where the ?hare in the pepper? lies shows the report of the Petitionsausschuss of the German Bundestag. In the printed matter 15/5570 of 01.06.2005 it is called ?a Petent turns against the unrestricted seizability ? He stated that in the course of insolvency proceedings in 2002 his life insurance policy concluded in 1989 with a pension commitment had been seized?
Anyone who is confronted with this as an entrepreneur with an existing pension commitment is surprised: Weren’t an agent, an insurer and also one’s own tax advisor convinced that insolvency protection would certainly apply after advertising?
Correct advertising by insurers?
Recently, a sales circular once again stated that “the Federal Supreme Court explicitly confirms in its ruling of 7 April 2005 that the pledging of a reinsurance policy is insolvency-proof even after the entry into force of the Insolvency Code”. Critics think that here the mediators are led negligently into the mistake, because
1. any creditor of the GGF may attach the reinsurance,
2. the insolvency administrator can always terminate, dissolve and collect the reinsurance, 3. the insolvency administrator may set off against the claims arising from the commitment.
Why is that so obvious? Simply because according to the Heubeck values with 6% the pension provision is economically much too low ? the two to threefold value comes much closer to the reality of a commercial balance sheet (cf. § 253 HGB) or the over-indebtedness balance sheet (cf. § 19 InsO): then, as in many GmbH insolvencies, the insolvency administrator will reclaim and offset excessive withdrawals. Thus the practice.
Offsetting has nothing whatsoever to do with the revocation of a commitment (cf. BGH ruling of 17.12.2001, Ref. II ZR 222/99): For the design, the ruling shows that the immediate bringing about of vesting ? time with the commitment – is recommended.
100% waterproof solution domestically?
There are various approaches to this. First of all, it is a question of separating the “reinsurance” from the company so that an insolvency administrator does not have direct access to the insurance assets.
Let’s let the sales manager of a U-Kasse have his say: “We have made it clear to every insolvency administrator that the fund’s assets are earmarked for a specific purpose. By presenting our articles of association, we have then sent every insolvency administrator packing? That’s good, but the devil is in the details ? it all depends on the benefit plan and the articles of association: And according to this, not every U-Kasse (for the GGF) is “insolvency-proof”. As one expert puts it, “If the sponsoring company succeeds in [also einem Insolvenzverwalter] to enforce a repurchase of the reinsurance policy, the saved insurance funds are lost to the employees in this way [also auch den GGF]. General statements that the U-Kasse is always insolvency-proof are incorrect.
In the way of a direct insurance with pension benefit can be saved likewise much: There is nevertheless here the possibility seizure-free amounts (dependent on the number of family members entitled to maintenance), in individual cases also already times 2000 euro, to secure against execution. But again, it all depends on the details, i.e. the exact conditions. A lump-sum benefit with an annuity option would be attachable, whereas an annuity benefit with a lump-sum option would hardly be attachable.
100% waterproof solution abroad? Another approach is to transform the company pension scheme into a private one. A private pension plan can be protected abroad, e.g. in Switzerland for the benefit of the spouse and descendants in the event of bankruptcy. Trust solutions abroad should also be considered ? because, in principle, enforcement and bankruptcy law is a matter for the national legal system; but here, too, the details matter, for example, international agreements on insolvency.
Private law insolvency protection is important !? writes a renowned insurer. But concerned insurance brokers wonder why the whole truth can’t be put on the table. Many entrepreneurs ask for solutions ? Numerous entrepreneurs and tax consultants are waiting for the intermediary with a need to restructure the occupational pension system.
*by Johannes Fiala, lawyer (Munich), M.B.A. (Univ.Wales), M.M. (Univ.), certified financial and investment advisor (A.F.A.), banker (www.fiala.de)
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PhD, MBA, MM
Dr. Johannes Fiala has been working for more than 25 years as a lawyer and attorney with his own law firm in Munich. He is intensively involved in real estate, financial law, tax and insurance law. The numerous stages of his professional career enable him to provide his clients with comprehensive advice and to act as a lawyer in the event of disputes.
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