Hello,
From what I know, as I was about to subscribe to the very same AXA 3rd pillar life insurance (but finally not, thanks to you guys!), you could try to keep that policy but ask them to reduce the premium value to a minimum, i.e. not close the contract. I don’t know for sure how much of this is true and helpful, but still worth a try. Give them a call.
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@Sirob
Hi Sirob, could you please reply my last question? I thought everybody in the forum told you to close your account with AXA ASAP, why do you still want to keep it? I may be in similar situation.
@Cortana @xorfish @nugget @pandas @Mr.Paprika @ilvalesco
My policy started 1st Nov 2016, do you think there is a deadline for me to stop and quit my current policy or I can do it at any time? the agent has not given me a precise date as deadline.
Would be grateful if you could help
Hello, I doublechecked MY contract and it is written it is possible to cancel whenever I want. You should check the general terms to be sure.
Options
- Keep that contract as a health and 3rd pilar (deductible for the swiss tax). In the future, you can use as a deposit to buy house/flat and you have a life insurance for your family in case of death. An option is to ask to reduce the amount of money you save on that insurance 3rd pilar every year and open a bank 3rd pilar (without life insurance)
- Cancel the contract and loose some money because you will get only the surrender value (by contract)
The final decision will depend on some parameters :
https://en.comparis.ch/saeule-3a/vorsorge/analyse/vorsorge-bank-versicherung
Sorry for the delay in responding.
Yes, many on the forum have advised me to cancel outright. By doing that, I incur a loss of approx. CHF 9,000
I am trying to get the annual premium reduced to CHF 600 and also trying to investigate of to utilise the eventual maturity value of the policy, approx. CHF 32,000 now and if reduced, around CHF 20,000 could be used against puchase of a house/apartment.
I have a meeting with Axa on 06 Dec and will update the forum when I come to know of the exact next options presented.
So I also signed one of these scam…and now did the sad maths in case it helps someone else:
Contract, rounded values to give an idea:
Signed in 2012, for 36 years
Guaranteed capital (alive at official “retiring”, or dead before retiring + 2 years): 91 000.-
In case of incapacity of working (valid after 24months): 18000 / yr (and 3000.-/yr contribution below stopped)
Contribution: 3’000 per year
Breakdown:
650.- for the incapacity of working
2350.- for the life insurance “linked to pension funds” (complete blackbox !!!)
Today I have a value of about 13’000.- according to statements
Maths:
I contributed 25’500 already since 2012. by the end of the contract I would contribute about 108000.- with probably only the guaranteed capital back so a loss of about 17’000, and that’s also without taking into account likely inflation losses !
I am investigating this, but as I understand, most likely the purchase value will be close to 13’000 (probably less with some fees). So more or less I expect I lost 50% of my contribution, however to be fair I have been insured in the meantime. What’s the cost of these insurances?
Costs of insurances:
The incapacity of working is clear on the contract: 650.- / yr
The life insurance is in average above 800.- / yr ((25’500-(8.5yr*650)-13’000))/8.5yr
In this black box, I’m not sure how to take into account interest of the funds. They change regularly the funds so it’s difficult to have historical data. The one I have now is 1.78% rolling year.
If I get it right, the interests are being sucked by the life insurance which is really expensive in a black box! And also the contribution to the salesmen…on top of this, according to other posts, a life assurance would be around 450.- / year only.
Next steps
I will try to have an appointment to understand:
-exactly the costs of buying back. Looking at this thread, I’m already convinced it’s the right decision.
-understand the scenario where I contribute much less than 3’000 per year while keeping insurances
-understanding the insurance landscape. Life insurance is not so important to me, but the incapacity of working is, as I have quite risky hobby. I need to understand how much it would be and if it exists in a single assurance contact, I guess then not in a pilar 3a.
Open questions
Maybe you guys can help?
-Did anybody investigate the cost of a separate “incapacity of working” insurance? Is is always linked to a pilar 3a or can it be purchased separately (as life insurance can if I understood?) Or is the mustashian way, that anyway you can manage with your own investments (would not work early in the process as you don’t have enough capital)?
-I have read some posts about buying pack such a bad package as above and transferring to other pilar 3a schemes such as VIAC. But how do you deal with the fact that you can only put 6800.- per year? Is it possible to put more in VIAC accounts but then you can declare only about 6800.- in tax deduction? How to avoid further taxation losses when transferring funds above 6800.-?
Thanks & cheers.
the basic insurance is already included with your AHV payments
viac scams you with hidden forex fees, it’s not worth it today - there are better options now
A transfer doesn’t count against the limit (and obviously doesn’t bring any tax deductions).
In my case AHV estimation would be around 2’000 per months, the insurance I mean add some cash on top of this.
Ok, found the topic to study thanks VIAC hidden spreads - #5 by pandas
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Ok, so a 3rd pilar transfer as not limit as such, only tax deduction is limited. Makes sense, thanks
I’ve used one for some time : 500.-/mo insured with no more contributions in case I end up having to use it. Cost: roughly 950.-/year for a 33 y.o. male with Swisslife. It’s still a 3A contribution (tax deductible, counts toward the max amount one can save per year) but it’s not linked to any sort of promise of accruing any sort of capital, just a pure insurance product.
It was still a mistake (I don’t have any dependents and could have trimmed down my expenses should the worst had happened) but it could serve a use in some cases (freelancers, bad 2nd pillar coverage).
Ok, I see, interesting to see other values, thanks. Seems that these type of products are only on 3a. And also extremely expensive. Interestingly in my contract I’ve got more insured for lower stated fees, but at the end of the day it’s a big black box…as I have been employee so far, seems that AHV + pillar 2 should cover enough in case of work incapacity. Will check further.
Congrats for closing this sh***!
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Congrats!
I still have to make the decision for myself… it’s quite hard ^^’
If I cancel everything, I’ll get nothing cause I only paid for 1 year…
You already lost this money the day you signed the life insurance contract. These are sunk costs, there is nothing you can do that will bring them back.
If it helps to make up your decision:
- Suppose you stay in this contract until retirement
- Compute how much money you will have paid into the contract in total, let’s call it A
- then look at your contract and the contractual value that they expect to pay you at retirement, let’s call it B
- In 90% of the cases, A >>> B , that is, you put more money in the contract that you will get at the end.
- Not only are you incurring losses, but you have a huge opportunity cost: compute how much money you will have if instead of paying into the life insurance, you would have put the money into a low cost index ETFs (historical average returns of 6-7%, which are still relevant for a 30 years period). For instance, Mr Paprika figured out here that by paying only 100 CHF per month into his life insurance, he would incurr an opportunity cost of around 100k CHF.
This is not insignificant: either you bite the bullet now and renounce to the money you have put in the contract, or you will later and the costs will be even bigger.
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Look at it in a positive way. You get out after only one year! There are people that got it after 10+ years and lost several 10k in opportunity costs.
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Thanks, I guess I’ll make my calculations tonight I very probably follow your advice! 
I’ll continue to read the forum for whether use viac with an affiliate link, frankly, or finpension…
If you have any idea, feel free to DM me, or tag me in the appropriate post thanks again for your advice everyone !
Interesting conversation.
I have recently started a family (twins) and was thinking about life insurance.
What I am taking away from here is that, if I really want to get a life insurance, I should buy a separate insurance product and keep my investments separate.
Did I get it right? Is anyone else here a parent or are you all trying to retire by 40?