The fairy tale of the unseizability of Rürup capital

The fact that not only the assets saved in a Rürup pension can be seized, but also the portion of the Riester credit balance which is not subsidized by the state, was already decided by the Regional Labour Court of Mainz (Az. 3 Sa 414/06) in a ruling of November 3, 2006 in the case of a certified Riester mini-pension in the savings phase.

 

The state subsidy regularly relates to only four percent of gross income, which in real terms will correspond to a pension of around six percent of gross income – too little to live, too much to die.

 

Too little to live – too much to die

The Rürup pension or the so-called seizure-protected pension scheme for self-employed persons requires a contractual prohibition of assignment and transfer. Insurers and distributors never tired of concluding that this ban was unseizable. But now the BMF has made it clear: “The seizure of the … retirement assets is not precluded by a contractual prohibition of assignment and transfer”.

Accordingly, the Federal Court of Justice (BGH) had already decided (decision of 25 August 2004: IX a ZB 271/03) that even a provision in the articles of association of a pension scheme regarding the non-transferability of the attachability does not prevent this.

Insurance associations, insurers and the insurance sales force have been praising the Rürup pension in advertising brochures for many years as a seizure-protected old-age provision. Now, according to a new letter from the Federal Minister of Finance (BMF) dated 31 March 2010 (Ref. IV C 3 – S 2222/09/10041 ), this is proving to be a mere marketing lie for customer acquisition.

 

The fact that not only the assets saved in a Rürup pension can be seized, but also the portion of the Riester credit balance which is not subsidized by the state, was already decided by the Regional Labour Court of Mainz (Az. 3 Sa 414/06) in a ruling of November 3, 2006 in the case of a certified Riester mini-pension in the savings phase.

The state subsidy regularly relates to only four percent of gross income, which in real terms will correspond to a pension of around six percent of gross income – too little to live, too much to die.

 

Attachment follows from constitutional law

The protection of the property right of creditors who wish to seize privately saved pension assets may only find a constitutional limit where the principle of the welfare state is affected. A creditor’s claim enjoys the protection of the German constitution as property – it may not be withdrawn from it by contractual transfer prohibitions as easily as the insurers would have liked.

The “Rürup lie” of the insurers was justified by the fact that an exclusion of exploitation was contractually agreed and transferability was excluded. But such contractual exclusions do not save from seizure, because constitutional creditor protection (the state may only protect the social minimum from the creditor in accordance with the constitution) has priority, as the BMF has now once again emphasised.

The tax office is probably also reluctant to watch how the self-employed (freelancers and tradesmen) set aside a generous pension plan and, for example, remain in arrears with their taxes. The Rürup saver also saves for the State (because of the saving of later support) and, incidentally, for its creditors (and, where appropriate, the tax office).

According to the Code of Civil Procedure (ZPO), courts will only leave the minimum subsistence level free of seizure in order to relieve the social security office, because the debtor should not be able to get out of debt at the expense of the general public. The seizure-free limits during the savings phase – and later after the start of retirement – are set at a correspondingly low level in the law on the seizure-free old-age provision of self-employed persons. These by no means reach the maximum limits up to which Rürup contributions can be considered pro rata as special expenses (20,000 to 40,000 euros per year), so that a large part of the saved Rürup assets remain seizable.

 

Insurers ignore legal situation

Since the legislator expressly provides by law for the seizure of the saved capital above the exemption limits, one has to admire the courage of insurers and expellees who consider themselves smarter than the legislator and simply deny this possibility. Yet to this day, they have not been able to produce a single judgement that confirms their fairy tale of the Rürup Treaty being exempt from seizure.

Nor does the clear legal situation prevent the Rürup saver from being entitled to payment of a surrender value upon ordinary termination. For it simply follows directly from the law on the seizure-protected old-age provision of self-employed persons (§ 851c ZPO) that the saved Rürup capital can be seized before the start of retirement above the limits set by social assistance. Insolvency administrators, tax authorities and other creditors will know how to enforce these claims, which are clearly left to them by law, against the insurers as well – the Rürup saver is left with only a pension at the social welfare level.

It is therefore also not true that there is no surrender value at all for the Rürup pension, which the insurers alternatively claim. Rather, it is always calculated from the accumulated actuarial reserve. It is only not payable in the event of ordinary termination because no death benefit has been agreed at the time of termination.

However, it is nevertheless present in the savings period, because it is used to calculate the non-contributory pension as “premium-free insurance”. In fact, the surrender value is then to be paid out in the event of withdrawal or rescission, as well as in the event of extraordinary termination in accordance with § 314 BGB (for example, because the employment agency does not provide benefits under ALG II or Harz IV because the saved assets are taken into account) and also – in accordance with § 851c ZPO – in the event of attachment.

 

Other opportunities abroad?

However, there are corresponding regulations abroad, such as in Liechtenstein and Switzerland, for assets for pension provision protected against seizure in any amount. The corresponding insurers are taking advantage of this in their advertising by advertising with “insurance secrecy and bankruptcy protection” in Germany.

On closer examination, this too turns out to be a distribution lie in 99.9 percent of cases, because according to private international law and state international treaties, this alleged bankruptcy protection, advertised as a “princely privilege”, cannot intervene at all.

 

by Dr. Johannes Fiala

 

by courtesy of

www.cash-online.de (published on April 23, 2010)

Link: http://www.cash-online.de/versicherungen/2010/die-vertriebsmaer-von-der-unpfaendbarkeit-des-ruerup-kapitals/25456

and

www.performance-online.de (published in Performance, issue 06/2010, pages 46-47)

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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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