Pension products compared

Pillar 3 products from insurance companies and banks


When it comes to pensions, the range of available options is diverse. Both banks and insurance companies offer suitable products. Insurance plans always also include insurance cover for risks such as incapacity for work, illness/disability or death. The following is a brief summary of the most important features and differences between insurance plans and bank accounts.

Insurance Bank account
Tax savings
  • Fully deductible from taxable income up to the maximum annual contribution as set by law
  • Fully deductible from taxable income up to the maximum annual contribution as set by law
Cover / protection
  • Option to include sum payable at death and/or pension/waiver of premium in the event of incapacity for work
  • None
Interest yield
  • Depending on the chosen product, usually a guaranteed sum payable on survival and at death with allocated profits
  • In addition, there is the possibility of choosing unit-linked insurance, which may generate greater returns but comes with higher risks
  • Savings account: The bank may adjust the interest rate at any time; interest tends to be rather low
  • Investment account: Greater returns possible, but strongly fluctuating yields and thus a higher risk of loss
Payment
  • Depending on the chosen product, flexible contributions or fixed periodic premiums up to the statutory maximum
  • Flexible contributions up to the statutory maximum
Note
  • Many insurance companies also offer bank-like products
  • The interest rates are set by the banks individually and may differ considerably
  Pension review Pillar 3a accounts