How insurers’ lies harm small and medium-sized businesses by the millions

New ruling by the Federal Court of Justice (BGH): Attachment of Rürup pension possible at any time

Insolvency security of the basic or Rürup pension?

The state allows up to 20,000 euros per person and assessment year to be partially deducted as special expenses for tax purposes in the case of private old-age provision through basic pension contracts. A prerequisite for this is, for example, that an exclusion of exploitation has been contractually agreed. A termination, hypothecation, capitalization, assignment, inheritance or a pledge are thus contractually excluded. Only when you retire at 62 or, in exceptional cases, earlier in the event of occupational disability, is a lifelong pension paid out of the accumulated capital.

The insurers tenaciously claim that the contractual exclusion of realisation also prohibits the creditor from realising the saved capital through termination – therefore the capital of the Rürup pension is insolvency-proof before the start of the pension. Only then could the Rüruprente due be seized like earned income. This sales argument was so important to the insurers that they therefore turned a blind eye to the truth.

The declaration of the insolvency administrator not to enter into the contract means its termination

However, the Federal Court of Justice (BGH judgement of 01.12.2011, ref. IX ZR 79/11) ruled that the contractual exclusion of realisation, which is always invoked by insurers, precisely does not exclude seizure. Basic pension insurance policies (also known as Rüruprente) are therefore not inherently part of the seizure-protected insurance contracts.

Rüruprenten contracts are seizure-proof in the accumulation phase within certain limits only if, by way of exception, they simultaneously meet all the requirements of the so-called seizure-protected old-age provision pursuant to § 851 c of the Code of Civil Procedure (ZPO). However, this too only offers limited protection, above which the saved capital can be seized in accordance with the German Code of Civil Procedure (ZPO) even before the start of the pension – and these limits are far lower than the tax-privileged contributions in Rürup contracts.

Straight ones gladly sold Rürupverträge with maximally tax-permitted inclusion of an occupational disability pension are not seizing-protected, because the BU pensions then far higher opposite the insured age pension contradict the requirements to a limited seizing-protected age precaution after § 851 c ZPO, because these do not permit a higher BU pension than the later age pension.

Contractual exclusion of realisation does not protect in the event of realisation by creditors

The insurers derive the attachment protection for Rürup contracts from the contractual prohibition of realisation, to which the creditor or insolvency administrator is allegedly also bound. This consideration, however, is mistaken, as the BGH states. Otherwise, there would be completely unlimited protection against seizure in the case of old-age provision that is expressly only protected to a limited extent under § 851c ZPO, if only because of the exclusion of realisation, which the legislature did not want and is not allowed to introduce under constitutional law because of the protection of the creditor’s property.

No security for imputation due to Hartz IV and other social benefits

In fact, the exclusion of realisation within narrow limits serves to ensure that the pension saver really only receives his capital as a lifelong pension and does not consume it beforehand. But if the state would have to pay Hartz IV or other social benefits, possibly also legal aid, it can demand the prior consumption of the Rürup capital by extraordinary termination, as expressly stated in the explanatory memorandum to the law on seizure-protected old-age provision. As stated there, an extraordinary right of termination cannot be excluded in special circumstances such as the denial of Hartz IV benefits because of the Rürup capital, even in the case of a contractual ordinary prohibition of termination.

Even Riester contracts do not have to be fully garnishable

In the case of Riester contracts, nothing is protected with regard to overpayments (non-tax-subsidised part) in the savings phase. Of course, one can also speak of attachment protection in the case of only limited attachment protection, because the term does not mean complete unlimited attachment protection. Unfortunately, the term is often confused with this until the rude awakening comes.

The BGH refers to pensions that are publicly subsidised (by means of tax allowances) (i.e. § 851 d ZPO). However, according to the definition of the Retirement Provision Certification Act (AltZertG), this only refers to the Riester pension, even if many insurers would like to add the Rürup or basic pension. According to this, Rürup is not considered to be “tax-supported”, but only premiums are partially deductible here as a special expense. The church is not “publicly supported” by the fact that the church tax is deductible as a special expense.

Any creditor can seize and cancel paid-in capital of basic pension contracts

The BGH ruling thus confirms, by not naming the Rürup pension among the seizure-protected insurance contracts, and by denying any seizure protection by the legislator at all before 2007 (and thus when the Rürup or basic pension was introduced), that it is initially completely seizable in the savings phase. Also the seizing protection in the respective borders applies only, as far as it fulfills at the same time all conditions of the § 851 c ZPO. According to the BGH, the legislator had not even thought of attachment protection at the time of the introduction of the Rürup pension.

Seizure protection if necessary to relieve the burden of social welfare and for your own burial

The BGH emphasises that private life insurance policies can be enforced unless they are subject to special attachment protection regulations such as § 850b I No.4. ZPO, § 850c II ZPO. Insurance policies only in the event of death, with an insured sum not exceeding 3,579 euros (typical death benefit insurance policies), are protected from seizure via § 850b ZPO. In the case of insurance policies for private old-age provision, § 851c of the Code of Civil Procedure (ZPO) provides complete protection for a cover capital which can regularly be used to build up an old-age pension of a maximum of only around 1,000 euros per month. At most, the capital required for this at the start of the pension remains exempt from seizure, for younger people in stages considerably less.

Alternatives to private life insurance (basic or Rürup contract)

The higher courts have repeatedly emphasised that every German citizen, especially the self-employed, is free to pay into the German Pension Insurance Scheme (voluntarily) or, for example, into a pension fund if the statutes offer protection against seizure during the payment phase. Nevertheless, insolvency administrators and/or creditors can also access it in the payout phase, insofar as the garnishment-free subsistence minimum of all income (added together) is exceeded – if applicable, the not much higher limits for earned income also apply. In addition, everyone is free to look for solutions that offer protection against the loss of retirement benefits at home and abroad due to Promise enforcement and insolvency. However, the typical basic or Rürup pension is certainly not one of such solutions for SMEs, even if insurance brokers never tire of ignoring the legal situation and the BGH.

Dr. Johannes Fiala
Peter A. Schramm

( 23.12.2012)

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About the author

Dr. Johannes Fiala Dr. Johannes Fiala

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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