Term life insurance provides financial protection for your dependents in the event of your death. This is particularly important if you are planning to buy or have a property built. Since in most cases a loan is taken out to finance construction, it should be insured. In the event of your death, the loan debt would be transferred to another borrower, but that borrower would not be financially burdened by the insurance. In addition, many banks also require term life insurance to secure the home loan.
term life insurance is required by many banks to secure construction financing.
Difficult access to term life insurance due to a previous illness
When taking out life insurance, pre-existing conditions lead to premium surcharges or rejection by insurance companies, as the probability of death is significantly increased. In recent years, there has been an increase in "widespread diseases" such as cardiovascular diseases, obesity and mental illnesses. However, it is precisely these groups of people who are often interested in term life insurance, even if their previous illness makes it difficult for them to access it.
So-called special actions can provide a remedy here. In conjunction with construction financing for a real estate deal, easier eligibility criteria may apply to term life insurance. This means that fewer questions are asked during the health check, thus simplifying access to the insurance. From experience we can say that the use of the special actions makes sense, because they work well and are not more expensive than other term life insurances.
Amount of coverage for a construction loan
Before choosing the amount of coverage, you should ask yourself the following question: Do I only want to insure the construction financing, i.e. the real estate loan, or do I also want to insure my family?? If you only want to cover the loan or remaining debt, you can choose a plan with a decreasing sum insured. The premiums and the sum insured fall annually by a constant amount or by an amount adjusted to their remaining debt. To avoid over-insurance and still guarantee sufficient coverage for your dependents regarding the loan.
Special promotions in conjunction with a construction loan
There are several options for the special actions. The respective conditions are explained in more detail below.
Special offer I
The conditions are a real estate financing or. New medical practices as well as no planned non-European stays abroad of more than 6 months in the next 12 months. Furthermore, a health declaration with the following content must be submitted:
I hereby declare,
– that I am currently fully able to work and
– That I have no illnesses or injuries currently or in the last 2 years, respectively. for which I have been seen by a doctor or therapist (e.g. a doctor's appointment).B. (e.g., non-medical practitioner, psychotherapist) has been or will be undergoing treatment for more than 6 weeks, and
– that no reduction in earning capacity or severe disability has been recognized or applied for in the last 5 years.
The general conditions given by the insurance company are:
- insurance serves to secure a loan
- Loan agreement concluded within the last 6 months
- Sum insured: max. 400.000 €
- Entry age: max. 44 years
Special offer II
In this case, the death insurance must be used to secure a loan for the financing of a property. The related loan agreement must have been concluded within the last 6 months. Other requirements are:
- Sum insured: max. 300.000 €
- Entry age: max. 45 years
- Final age: max. 65 years
- Contract duration: 10-30 years
- Health declaration (if this cannot be submitted, further health questions will follow)
Special offer III
This special offer is only possible in connection with a wustenrot "Ideal" building society loan or a mortgage loan with Wurttembergische Lebensversicherung.
The following conditions apply:
- Sum insured: between 10.000 € and 120.000 €
- Age of entry: between 18 and 62 years
- Final age: max. 67 years
- Insurance period: between 5 and 20 years
The special features of this variant are the single and partner tariff and the non-existing distinction between smokers and non-smokers. In addition, this is a death benefit without health questions/health declaration.
Special action IV
This tariff is available when taking out a loan, or up to 6 months thereafter, to finance an owner-occupied property. It is a death insurance with simplified health questions with the following prerequisites:
- Death benefit: max. 200.000 €
- Entry age: max. 50 years
- Final age: max. 67 years of age
- Insurance period: max. 25 years
The special actions include the possible additional insurances, such as espw. Disability insurance, without health questions.
Special Action V
This special offer is a death benefit with simplified health questions, which includes the following requirements:
- Sum insured: max. 400.000 €
- Entry age: max. 49 years
In addition, the loan must be used to finance a newly acquired property or the acquisition of a practice/law firm and the associated loan agreement must have been concluded within the last 6 months.
Special offer VI
The construction financing must be a loan for the financing of a property (new acquisition as well as reconstruction, modernization), so that this special action can take effect.
The following parameters also apply:
– Sum insured: max. 150.000 €
– Entry age: max. 65 years
– Term: max. 15 years with renewal option
As special features the not existing health questions as well as condition that the disbursement of the loan sum before max. 12 months. Excluded are only diseases of the heart, circulatory system, spine, joints, digestive organs, as well as cancer, HIV, chronic diseases and consequences of accidents, if these were diagnosed in the period of 12 months before the start of insurance and 24 months thereafter in connection with the benefit case (death). After the 24 months, full insurance coverage
Individual solutions for your term life insurance
Independently of the above special offers, we can check if there are more attractive alternative solutions by making inquiries to different insurance companies, thus allowing you to compare offers. Finally, the indicated actions are not always suitable for your individual situation. In a consultation we discuss your case and then look for the ideal solution for your problem.
This service is free of charge for you, as we are compensated by the respective insurer in case of success. If you are interested, you can always contact us free of charge!