Pillar 3A insurance - how to cancel without losing everything

#20

Both calculations state the same premiums payment period date. I’ve edited my reply - my guess is they probably have to reimburse on top of buyback value the prorated premium for the year from the cancellation date forward and they’ve conveniently chose to omit the cash value of this detail from the mail, leaving this as an exercise for the reader to find this bit on their own in the AGBs

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#21

I expect there are some fees due to short notice cancellation while cancellation for November does not include this fees.
I expect that some customers are in difficult situation and need the money back almost at once and this is juicy business for the insurance company as the customer does not have the waiting option like Sirob today.

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#22

I agree that the letters do not provide much explication. We therefore can just guess as to the reason for the difference. A very cautious person could inquire further with the insurer as to this point.

However - the text is unambiguous and mentions a higher number without reservations. There is not much legal wiggle room if you terminate by referencing the specific letter / terms and respect the dates.

I already recommended reading the (general) terms. Any surprises would have to be mentionned there.

If you wanted to be abundantly cautious, you could ask be email whether the “surrender value” will also be the amount paid out.

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#23

Many thanks everyone for the advice and tips!

I will speak again with the Axa agent today (mentioning all the points laid out above) and update you after that.

Have a good week ahead.

#24

An important point to clarify with your insurer.

By cancelling other kinds of insurance, I did get pro-rata premiums back. So what @hedgehog mentionned is also in my view a realistic possibility.

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#25

Hello Mustachians,

After all the very useful tips/opinions given so far, I had a discussion with the Axa agent yesterday, sent him an email with the summary and obtained the following confirmation from him. I have copied the email below.

As per our discussion, please find below the summary. Please correct or add your points in case if required.

"
As I mentioned earlier, I am holding the Axa policy no. XXX. I have paid 2 annual premiums till now, CHF 6,768 in 2016 and CHF 6,768 in 2017.

I would like to cancel this policy and not pay any further premiums as I wasn’t aware when I bought this policy, that the surrender value of the policy is less than the amount of premiums that I have paid in

From our discussion over the past week, I have the following 3 options:

  1. Completely cancel the policy effective 1st Nov 2018. The registered cancellation letter should reach Axa latest by 15th Nov 2018. In this case, the policy would be completely cancelled and I would get back a total amount of money which is approximately CHF 4,250. This amount would be directly transferred to a Pillar 3A account with another company of my choosing.

  2. Convert the current policy into a zero-premium policy effective, for e.g. 1st Nov 2018. This means that I would not pay any further premiums than what I have already paid so far (CHF 13,536) and the new zero premium policy remains in effect beyond 2018, until the new term of the policy.

In case I want to completely cancel this zero-premium policy in, for e.g. 2020, then I will get back a total amount of money which is approximately CHF 4,250 + any applicable bonus from start of zero-premium policy to the cancellation of zero-premium policy. This amount would be transferred directly to a Pillar 3A account with another company of my choosing.

  1. Convert the current policy into a zero-premium policy effective, for e.g. 1st Nov 2018. This means that I would not pay any further premiums than what I have already paid so far (CHF 13,536) and the new zero premium policy remains in effect beyond 2018, until the new term of the policy.

In case I want to buy a house in, for e.g. 2022, then I will pledge the zero-premium policy with the bank (from whom I am taking a housing loan) and the amount of money which I will get from the zero premium policy for buying a house in, for e.g. 2022, is approximately CHF 4,250 + any applicable bonus from start of zero-premium policy to the date of pledge with the bank.

Please review the above statements and correct or add anything if required.

Please reply back with the corrections and confirmation. That will help to have a better understanding between us.
"

His reply:
"
Good morning,

Thank you for your friendly call and the mail.

Your points are correct. When you change the policy in to a premium free policy you will not have a worth of pledge. So if you give the policy to a bank after you made a premium free policy we will show only the new surrender value plus any applicable bonus. The value at point three is the same as in point two.

I wish you a good day.
"

In light of the above reply, I will be cancelling the policy effective 1st Nov 2018, using a registered letter and reference the already received official letter + official email while cancelling.

Thanks very much for your time in reading and providing any advice!

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#26

Where do the approx. CHF 500 above the surrender value come from? :blush:

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#27

Good spot @cray that extra 500 CHF comes if and only if I cancel after 1st Nov but before 15th Nov.

If I cancel before 1st Nov, I get CHF 3,732

If I cancel after 15th Nov, I have to pay the policy premium until 15th Nov.

I have replied back to the agent asking him to double confirm that I will not have to pay ANY premium in 2018 if I cancel between 1st and 15th Nov (the registered letter should reach Axa before 15th Nov).

#28

Hmmm…I just do not understand WHY those numbers keep growing, and so miracously. Roughly 12% in 2 weeks (500/3700*100) is a lot.

Did you get the “Wert- bzw. Kostenaufstellung” @nugget mentionned? They have to give it to you and it’s more than just the surrender value. It tells you how much is set aside for the risks, how much for saving, how much for the agent etc.

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#29

Not yet @cray but I will ask again for the same tomorrow morning. Thanks for the reminder!

#30

The number are not growing, they just shrink a bit less. :blush:

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#31

Good morning Mustachians,

Please find below the next couple of email exchanges between me and the Axa agent.

My email after last exchange:
"
Dear XXX,
Thanks for the correction and the response. I have one follow-up question.

If I take option no. 1 and send a registered letter to Axa as of 1st Nov 2018 requesting to completely cancel my policy (effective 1st Nov 2018), then will I have to pay the policy premium for 2018 until 31st Oct 2018 (in addition to the CHF 13,536 that I have already paid for 2016 and 2017)?

Have a good day.
Regards,
"

Axa agent Reply:
"
Good morning,

Thank you for your question.

When you cancel the policy until the premium date you don’t have to pay any more premium. You will receive the premium slip one month before the due date, but you don’t have to pay it. Important for this is to send us the wish of the cancellation until the first of December.

Please note, that you don’t will receive a tax confirmation when you don’t pay a premium in the pillar 3a.

Best regards.
"

To which, my reply again:
"
Dear Mr. XXX,
Good morning. Hope you are doing fine.

Thanks for the confirmation that I will not have to pay any premium in 2018 and any more premium than I have already paid (CHF 13,536 combined in 2016 and 2017).

I will then wait for the premium slip, which is sent one month before the due date.

Once I receive the premium slip, I will post a registered cancellation letter to Axa, requesting for a complete cancellation of the policy effective 1st Nov 2018. I will ensure that this registered cancellation letter reaches Axa before 15th Nov 2018.

I will also inform you in the cancellation letter of the Pillar 3A account which I will open with some bank so that you can then transfer the approximately CHF 4,250 directly to this new Pillar 3A bank account.

Yes, I am aware that I will not receive any tax confirmation when I don’t pay the premium. Thanks for informing me about that.

I have just two questions now:

  1. As discussed before, could you please provide me a copy of the Wert- bzw. Kostenaufstellung for the currently existing insurance policy?

  2. When I send the registered cancellation letter in Nov 2018, which address should I send this letter to and whom should I address it to?

Have a good day.
"

#32

Is the insurer playing dead moose or did you get the
Wert- bzw. Kostenaufstellung?

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#33

Thanks for querying @cray

The insurer is indeed playing dead moose. They replied that they supplied me with the surrender value table and now the next step for me is to send a registered cancellation letter effective 1st Nov 2018 to them, which must reach them before 15th Nov 2018.
Not sure if any more follow up will yield further benefit. Do you have any advice?

#34

If you want the Aufstellung, a registered letter should do the job.

The law says that the insurer must give you all the information necessary so that an expert may check their calculation. I assume that the Aufstellung is necessary for that. FINMA has to check the calculation for you free of charge, if you want it.

So I would write your request to the management of the agency you are dealing with. Mention that you requested the Wert- bzw. Kostenaufstellung that the agent did not want to provide. (Also add insurance number and stuff.)

Ask them to take note, that you will have to, according to Art. 92 al. 1 and 2 VVG, ask FINMA for their help with the calculations should you not receive the requested statement until June 30th, 2018.

At the end, express your hope that burdening a state agency can be avoided.

Here is the relevant legal framework (no english version available):

SR 221.229.1 Bundesgesetz über den Versicherungsvertrag

Art. 92

c. Obliegenheiten des Versicherers; Nachprüfung durch die FINMA; Fälligkeit der Rückkaufsforderung1

1 Der Versicherer ist verpflichtet, auf Anfrage des Anspruchsberechtigten binnen vier Wochen den Umwandlungswert oder den Rückkaufswert der Versicherung zu berechnen und dem Anspruchsberechtigten mitzuteilen. Der Versicherer muss, wenn der Anspruchsberechtigte es verlangt, überdies diejenigen Angaben machen, die zur Ermittlung des Umwandlungswertes oder des Rückkaufswertes für Sachverständige erforderlich sind.

2 Die FINMA hat auf Ersuchen des Anspruchsberechtigten die vom Versicherer festgestellten Werte unentgeltlich auf ihre Richtigkeit hin zu prüfen.

3 Stellt der Anspruchsberechtigte das Rückkaufsbegehren, so wird die Rückkaufsforderung nach drei Monaten, vom Eintreffen des Begehrens an gerechnet, fällig.

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#35

It just occurs to me that it was Axa selling an overpriced house insurance to my dad. Upon his death (and the transfer of ownership), I used the extraordinary right of termination that the law provides. Axa was trying a lot to keep the insurance going (in vain). Bad memories.

Be firm.

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#36

Thanks @cray for the advice. Yes, I am sticking to my position and will not let up.

Will update this thread as soon as I have any further news.

#37

Same happened with me…
You can read and find my story here:

After a long reclaim process I could finally end my contract with zero loss. I have fingers crossed for you :crossed_fingers:t3:

Have a nice weekend :slight_smile:

#38

Hi there!

I’m in the process of cancelling my insurance (I also posted on that thread).

Could you please share any tips? How have you avoided any losses?

Thanks!

#39

Hi,
I claimed the consulting process (it was on english), and mentioned many times, that I didn’t wanted a life insurance, just only a 3rd pillar account, but I ended up in one.
Read the other topic and my posts, I hope you can also come out of this contract.
Fingers crossed!

Best,
Mr.P

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