{"id":30510,"date":"2021-08-16T12:32:13","date_gmt":"2021-08-16T10:32:13","guid":{"rendered":"https:\/\/www.fiala.de\/?p=30510"},"modified":"2026-06-22T21:44:30","modified_gmt":"2026-06-22T19:44:30","slug":"federal-agency-fails-to-count-ruerup-savings-against-benefits","status":"publish","type":"post","link":"https:\/\/www.fiala.de\/en\/federal-agency-fails-to-count-ruerup-savings-against-benefits\/","title":{"rendered":"Federal Employment Agency Fails to Count R\u00fcrup Savings \u2013 Authorities Ignore the Will of the Legislator"},"content":{"rendered":"

\u2013 How insurers’ false claims are believed and cost the middle class millions \u2013<\/strong><\/h2>\n

No protection from imputation in the case of Hartz IV and other social benefits<\/strong><\/h3>\n

In an admirable act of lobbying, life insurers have managed to persuade intermediaries, customers and even the Federal Employment Agency that the capital saved in a R\u00fcrup pension would be safe from being drawn upon in the event of hardship \u2013 for example, when applying for Hartz IV. In reality, however, the narrowly limited exclusion of realisation serves only to ensure that the pension saver actually receives his capital as a lifelong pension and cannot consume it beforehand for his own purposes. Yet if the state were obliged to pay Hartz IV or other social benefits \u2013 or even legal aid \u2013 it may demand the prior consumption of the R\u00fcrup capital, as is expressly set out in the explanatory memorandum to the seizure-protected old-age provision and as the legislator intended. As stated there, an extraordinary right of termination in special circumstances \u2013 such as, the example given there, the refusal of Hartz IV benefits because the saved R\u00fcrup capital is counted as an asset \u2013 may under no circumstances be excluded, even where there is a merely contractual ordinary prohibition of termination. The state has no interest in immediately granting social benefits to a R\u00fcrup saver so that the assets in his R\u00fcrup contract are preserved for a more comfortable supplementary pension later on.<\/p>\n

Ineffective clauses permit ordinary termination by the policyholder<\/strong><\/h3>\n

What is more, even those provisions in the General Terms and Conditions of Insurance (GTCI) that exclude the right of termination without restriction and, in addition, seek to convert the R\u00fcrup contract into a non-contributory policy upon termination must be called into question: they may simply be ineffective as contradicting the will of the legislator. Nowhere has the legislator permitted insurance companies to exclude every kind of termination with the consequence of a complete contract termination with their customers \u2013 including, for example, termination without notice or extraordinary termination “for good cause”. To continue depriving the customer of the assets accumulated by the insurer through his premium payments “by merely releasing him from the obligation to pay premiums”, despite an extraordinary termination, is likely to violate the prohibition on unreasonable disadvantage (\u00a7 307 BGB (German Civil Code)<\/a>) and to be more than surprising (\u00a7 305c BGB<\/a>).<\/p>\n

In some insurers’ legal departments there is apparently the mistaken belief that one may try to push beyond the statutory limits \u2013 but in such cases the courts treat the entire clause (for instance on the exclusion of termination, or on the release from premium payment instead of a repayment of capital) as null and void. This means that such contracts no longer contain any effective exclusion of termination and, contrary to the wording of the GTCI, may be terminated at any time \u2013 including by ordinary contractual termination.<\/p>\n

Numerous grounds for extraordinary termination of R\u00fcrup contracts without notice<\/strong><\/h3>\n

Anyone holding a R\u00fcrup contract whose saved capital is counted against Hartz IV is, because of the refused Hartz IV benefit, in a situation of hardship, and may therefore terminate the R\u00fcrup contract extraordinarily \u2013 a contract to which not even the legislator failed to refer clearly enough in the legislative materials \u2013 and need not then content himself with a mere release from contributions. Only the payment of the R\u00fcrup capital following notice corresponds to the legislator’s intention that it should be counted against Hartz IV.<\/p>\n

Since the first financial market crisis, extraordinary terminations of life insurance policies have become more frequent because one insurer or another has become financially unsound. The BGH (Federal Court of Justice) ruled long ago on the right to terminate without notice “where performance of the insurance contract by the insurer has become uncertain” \u2013 a right that can never be excluded by general terms and conditions \u2013 in its judgement of 04.04.1951 (Ref. II ZR 32\/50<\/a>). In this constellation, too, a mere premium waiver is plainly no suitable solution in the event of extraordinary termination, because the contract is not fully terminated and the capital remains at risk with the unsound insurer. Moreover, a customer who has, for example, paid in a single premium or has already converted to a non-contributory policy would in this case have no remaining possibility whatsoever of rescuing his capital by terminating the policy with an insurer that has become unsound, in line with the BGH. Clauses that then provide only for a release from premium payment and refuse to pay out the capital are therefore likewise likely to be simply null and void.<\/p>\n

Can the R\u00fcrup contract be rescinded?<\/strong><\/h3>\n

If, however, these provisions are invalid, then not even the ordinary right of termination is effectively excluded, nor is the conversion into a non-contributory benefit \u2013 provided exclusively for the case of ordinary termination \u2013 effectively agreed. As a result, such ineffective provisions unfortunately satisfy neither the tax requirements of a basic pension nor the requirement of the Code of Civil Procedure for the very limited attachment protection of an old-age pension at the level of social assistance. Not only because of the attendant danger that one might end up being pursued as a tax evader on account of one’s R\u00fcrup contract, but also a rescission of the entire contract may come into question alongside the termination.<\/p>\n

In addition, the R\u00fcrup contract was advertised and promoted with the tax privilege, the protection against seizure and the Hartz IV security. If even one of the conditions relevant to the conclusion of the contract is absent, that would already be reason enough to be entitled to rescind the contract on grounds of deception. Otherwise, what remains is the somewhat less favourable option of termination with payment of the actuarial reserve, or the deliberate acceptance of the threat of future losses through seizure, set-off against social benefits, or tax reclaims.<\/p>\n

The legislator makes the right of termination with repayment of capital clear<\/strong><\/h3>\n

The claim that no extraordinary right of termination would exist under the BGB (German Civil Code) is therefore incorrect, because this statutory right of termination cannot be excluded by contract at all. With particular regard to the asset imputation in the case of Hartz IV \/ ALG II, the legislature already expressly addressed this in Bundestag printed paper 16\/886:<\/p>\n

“Unaffected by this exclusion of ordinary termination remains the possibility \u2013 within narrow limits, and also for life insurance \u2013 of extraordinary termination pursuant to \u00a7 313 para. 3, \u00a7 314 of the Civil Code, or exceptionally as a result of other unreasonableness. Continuation of the insurance contract could, for example, be unreasonable for the policyholder if termination is necessary because the policyholder is denied benefits under SGB II (German Social Code, Book II) owing to existing pecuniary claims under the contract.”<\/p>\n

In light of this clear statement, it is obvious that the contrary assertions of insurers should be judged as deliberate misrepresentation. This also applies to the claim that, in the case of R\u00fcrup contracts, there is already a statutory exclusion of realisation, just as in the case of the tax-subsidised Riester contract. One can no longer believe in a mere error or oversight on the part of the insurers here.<\/p>\n

The General Association of the German Insurance Industry recognised the legal risk in its opinion of August 2006:<\/p>\n

\u201eIn principle, the employment agencies must provide benefits to job-seekers who are capable of working where they are in need, in accordance with \u00a7 19 SGB II<\/a>. If a person seeking assistance were denied benefits, for whatever reason, this would also have consequences for his or her ability to agree to an effective waiver of disposition. For the failure of the benefits gives rise \u2013 at least according to the present legislative materials \u2013 to a special right of termination (pursuant to \u00a7 313<\/a> para. 3, \u00a7 314 BGB<\/a>) for the person concerned, as foreseen by \u00a7 165 para. 3 VVG (German Insurance Contract Act)<\/a>. In that case, it would also no longer be possible for the person seeking assistance to claim the allowance under \u00a7 12 para. 2 No. 3 SGB II; this requires the agreement of an effective waiver of disposition.<\/em><\/p>\n

Ultimately, neither the policyholder nor the insurer would therefore be able to assess in advance whether a contract concluded between them pursuant to \u00a7 165 para. 3 VVG is legally effective or not.<\/em><\/strong>“<\/p>\n

That is precisely the legal situation.<\/p>\n

Employment agencies unlawfully spare the R\u00fcrup capital<\/b><\/h3>\n

According to settled case law, the state cannot reasonably expect self-employed persons who have made old-age provision through a private life insurance policy to fall to its charge as welfare cases: self-employed persons may therefore (only upon application to the court pursuant to \u00a7 765a ZPO (German Code of Civil Procedure)<\/a>) prevent the seizure of current pension payments to that extent. In the pension phase, this will often amount to more than may be saved “protected against seizure” under \u00a7 851c ZPO<\/a>.<\/p>\n

The capital before the start of the pension, however, cannot be protected in this way. Yet, to the detriment of the taxpayer and of the unemployment contributions payable by employers and employees, the Employment Agency has so far regularly failed to apply this option of crediting, thereby ignoring the will of the legislator. Here the insurers’ lobbying \u2013 which has even persuaded the employment agency of an incorrect legal position \u2013 leads to harm to the middle class and the taxpayer through unnecessarily high unemployment contributions, in order to make up for the funds lost through the failure to lawfully count and draw upon the R\u00fcrup capital. Apparently, the Federal Court of Auditors has not yet become aware of this maladministration.<\/p>\n

by Dr. Johannes Fiala and Dipl.-Math. Peter A. Schramm<\/p>\n","protected":false},"excerpt":{"rendered":"

How insurers’ false claims are believed and cost the middle class millions: contrary to widespread belief, R\u00fcrup pension capital is not protected from being counted against Hartz IV and other social benefits \u2013 and ineffective termination clauses may let policyholders cancel at any time.<\/p>\n","protected":false},"author":3,"featured_media":30506,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":"","rank_math_focus_keyword":"","rank_math_description":"","rank_math_title":""},"categories":[28],"tags":[502],"class_list":["post-30510","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","tag-ruerup-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/posts\/30510","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/comments?post=30510"}],"version-history":[{"count":1,"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/posts\/30510\/revisions"}],"predecessor-version":[{"id":30713,"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/posts\/30510\/revisions\/30713"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/media\/30506"}],"wp:attachment":[{"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/media?parent=30510"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/categories?post=30510"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fiala.de\/en\/wp-json\/wp\/v2\/tags?post=30510"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}