Is funeral insurance worth it in Germany?

Guide figures from published tariff examples, basic tariff with premiums ending at 85 and a waiting period.

Funeral insurance (Sterbegeldversicherung) is a small whole life policy. You pay premiums until a fixed age, usually 85 or 90, after which the policy is paid up and continues. When the insured person dies, the agreed sum goes to the family.

Its appeal is that there is hardly any health check and nobody can spend the money early. The payout arrives quickly, often before a German bank releases the account of the deceased.

Premiums depend almost entirely on your age at the start. The later you begin, the more each insured euro costs.

Always work out two things: what you pay in total until premiums stop, and at what age your payments exceed the sum insured. The table shows this for EUR 7,000 with premiums ending at 85.

With health problems. If you are seriously ill, you will not get normal term life insurance any more. Funeral insurance asks few or no health questions and uses a waiting period instead. Here you buy protection you could not get otherwise.

Without savings. A fixed direct debit builds money that would otherwise not be set aside. The discipline is the real benefit.

When the money must be earmarked. You can assign the payout directly to a funeral director or name a specific person. A savings account falls into the estate and can be blocked for a long time if several heirs must agree.

If you may leave Germany later, ask whether the policy continues and pays out when you live abroad, and in which currency. Policy terms are in German, and the German wording counts.

If you want to be buried in your home country, EUR 7,000 will rarely be enough. Repatriating a coffin by air outside Europe alone costs about EUR 4,000 to 15,000. Either choose a higher sum or plan for cremation in Germany and sending the urn home.

If you are healthy and save regularly, the account almost always wins. Put EUR 35 aside every month from age 60 and after 17 years you have about EUR 7,140, even without interest.

You can access the money at any time, pay no policy costs, and what you do not need stays in the estate. The risk is yours: if you die shortly after starting, there is not enough. That risk is exactly what the insurer takes on, and what you pay for.

If you are younger and have a family to protect, term life insurance (Risikolebensversicherung) gives a much larger sum for a few euros a month. It usually ends around 75, so it does not replace funeral provision in old age.