Sell Your German Life or Pension Insurance Instead of Cancelling

You are leaving Germany and wondering what to do with your Lebensversicherung (life insurance) or Rentenversicherung (private pension insurance). Cancel it and take the money? Sounds obvious — but in most cases it is the worst move. Since 2014 we have supported 40,000+ deregistrations from Germany and regularly see emigrants leaving thousands of euros on the table by cancelling.

Good news: you can sell the policy instead of cancelling it and pull significantly more out of it — on average 30 % more, and in specific cases up to 100 % more than the regular surrender value. The same applies to life insurance, pension insurance, Bauspar contracts and even Riester and Rürup policies.

At a glance

• A hasty cancellation can cost you a five-figure amount
• Selling pays on average 30 % more than the surrender value, in certain cases up to 100 % more
• Lawyers and insurance mathematicians review your policy for calculation errors and back-claim opportunities
• First payment after 18 calendar days, full settlement after about 8 weeks
• Consultation is fully free and non-binding — Pro Life only earns on the value uplift
• Bauspar contracts, Riester, Rürup and unit-linked contracts can also be sold
• For run-off insurers (Generali/Proxalto, Athora, Frankfurter Leben), selling is particularly urgent
• Leaving the EU/EEA triggers a Riester subsidy claw-back — checking beforehand pays

Why you should not simply cancel your life insurance

Capital-forming life and pension insurance products were the bedrock of German retirement planning for decades. Reality looks different today: low guaranteed interest rates (from 2025 new contracts at 1.0 %, before that 0.25 % to 4.0 % depending on the year of signature), high acquisition and administration costs, and missing inflation adjustment turn many policies into a bad deal. You can even end up with less than you paid in over the years.

Still, do not cancel hastily. The risks of cancelling that emigrants regularly underestimate:

• Low surrender value: on cancellation you often receive far less than the contributions paid. In the first 5–10 years the acquisition costs eat the bulk of contributions — the surrender value can sit below 50 % of the deposits.
• Capital gains tax: cancelling before the 12-year rule (see below) leads to full taxation of the gain, typically capital gains tax (Abgeltungssteuer) at 25 % + solidarity surcharge + church tax if applicable.
• No error check: insurance contracts contain calculation errors and consumer-protection violations surprisingly often. A simple cancellation leaves these undetected.
• No back claims possible: after a cancellation you have no legal leverage to assert claims from BGH (Federal Court of Justice) rulings.
• No tax benefits on losses: losses through cancellation cannot be claimed for tax purposes — the money is gone.

In our experience from 40,000+ deregistrations, hasty insurance cancellation is one of the most expensive mistakes emigrants make — right after forgetting contract cancellations altogether.

"Have an expert review your options on a life or pension policy — particularly if you need capital for your emigration. I have seen hundreds of times how emigrants give away thousands of euros through a simple cancellation." — Oliver Frankfurth, founder of deregistration.de

Sell instead of cancel: how does it work?

Advertising disclosure.

Through our partner Pro Life you can sell your life or pension insurance professionally. The key difference to cancelling:

• On average 30 % more than the regular surrender value
• In specific cases up to 100 % more surrender value
• First payment after 18 days
• Consultation and quote fully free and non-binding
• Long-term legal leverage: further payouts possible under new BGH case law

The process in detail

1. Submit a non-binding enquiry: fill in a short form, free of charge and without obligation.
2. Contract review: Pro Life examines your contract with a team of lawyers and insurance mathematicians.
3. Uncover errors: in many cases calculation errors, faulty revocation instructions or consumer-protection breaches are identified. Each can trigger a contract revaluation.
4. Receive an offer: you get a concrete offer, typically clearly above the surrender value.
5. Sign the purchase contract: if the offer suits you, you sign. No hidden costs.
6. Fast payout: up to 90 % of the surrender value within 18 calendar days. After about 8 weeks comes the payout of the additional gain after full settlement.
7. Long-term support: when case law changes, Pro Life renegotiates with the insurer. Further payouts are possible years after the sale.

Request a non-binding offer

Why is Pro Life the right partner?

At Pro Life the focus is detailed review and valuation of your contracts. Unlike a simple cancellation, your contract is not just terminated but systematically searched for hidden value and errors.

• In-depth analysis: external specialists, lawyers and insurance mathematicians examine the contract
• Legal backing: if an out-of-court settlement is not possible, Pro Life goes to court
• Current case law: every valuation rests on the latest BGH rulings
• Long-term support: Pro Life stays active after settlement and renegotiates on new rulings

How does Pro Life secure the higher surrender value?

Once Pro Life acquires your life or pension insurance, a specialised team of lawyers and insurance mathematicians runs the detailed audit. The main goal: identify every possible payout and back-claim entitlement.

Typical levers:

• Revocation joker (Widerrufsjoker): was the revocation instruction at signature correct? Many contracts from 1995–2007 are flawed (BGH rulings from 2014 onwards).
• False cost disclosures: were acquisition and administration costs transparently shown?
• Guaranteed-rate calculation: was the promised interest rate correctly applied?
• Profit participation: were the promised surpluses correctly distributed?

Each of these levers can trigger back payments the original insurer would not have conceded voluntarily.

How does Pro Life earn?

Pro Life charges a fee based on a percentage of the settled contract value — about 30 % of the uplift. Despite this fee, you typically come out ahead because the additional surrender value is clearly higher than what you would have got cancelling on your own.

Example: a policy with a surrender value of EUR 30,000 — Pro Life reaches EUR 42,000. Uplift: EUR 12,000. Of that, about EUR 3,600 go to Pro Life, you receive EUR 38,400 — still EUR 8,400 more than direct cancellation.

Why can a further payout happen after several years?

Pro Life stays active after the sale. Two reasons.

1. Ongoing legal cases: If Pro Life sues the insurer over calculation errors or contract defects, the proceedings can run for years. If Pro Life wins, back payments flow proportionally to you — even though the original sale settled long ago.

2. New BGH rulings: Pro Life watches the Federal Court of Justice's case law. When a new ruling renders certain clauses void, Pro Life automatically checks whether your former contract is affected and renegotiates. These payouts cost you nothing extra.

Can you end up with less?

Theoretically yes — in practice almost never. Pro Life reviews the contract before the purchase and gives you a concrete offer. That offer already contains a premium over the surrender value. You decide whether to accept.

Risk scenario: Pro Life's offer sits below the regular surrender value. In that case you simply decline and cancel the normal way. You take no financial risk.

Which policies can you sell?

Not every policy can be sold. The following contract types qualify.

Life insurance

• Capital-forming life insurance (classic LV with guaranteed rate)
• Unit-linked life insurance (performance tied to funds)
• Direct insurance from occupational pensions (limited, depending on contract terms)

Pension insurance

• Capital-forming private pension (private pension with guaranteed rate)
• Unit-linked private pension (private pension with fund investment)
• Immediate-start pensions (already in payout phase, limited)

Savings contracts

• Bauspar contracts (especially older ones with high bonus interest)

State-subsidised retirement provision

• Riester contracts (warning: subsidy claw-back on emigration outside EU/EEA)
• Rürup contracts (limited sale possibility, because they are not pledgeable)

Other insurance

• Accident insurance with premium return
• Funeral cost insurance (rarely sellable)

Important: pure term life insurance (without savings component) and pure occupational pensions are generally not sellable. If you are unsure which of your policies qualify — the consultation at Pro Life is free and clarifies exactly that.

Concrete example calculations

Three real profiles showing what selling beats cancellation by.

Example 1: young contract (8 years runtime)

• Paid in: EUR 50/month over 8 years = EUR 4,800
• Guaranteed rate: 0.9 % (signed 2018)
• Surrender value on cancellation: EUR 3,900 (below contributions!)
• Sale price at Pro Life: ~EUR 4,500
• Uplift: roughly EUR 600

Young contracts with low guaranteed rates are worth less, but selling still tends to beat cancelling.

Example 2: medium contract (15 years runtime)

• Paid in: EUR 150/month over 15 years = EUR 27,000
• Guaranteed rate: 2.75 % (signed 2005)
• Surrender value on cancellation: EUR 31,500
• Sale price at Pro Life: ~EUR 39,000
• Uplift: roughly EUR 7,500

Contracts of 12+ years runtime are the sweet spot — the tax privilege kicks in (see below), uplift is high.

Example 3: old contract at a run-off insurer (25 years runtime)

• Paid in: EUR 200/month over 25 years = EUR 60,000
• Guaranteed rate: 4.0 % (signed 1998), currently with Generali/Proxalto in run-off
• Surrender value on cancellation: EUR 78,000
• Sale price at Pro Life: ~EUR 95,000 (run-off pressure makes the sale especially attractive)
• Uplift: roughly EUR 17,000

The levers: high guaranteed rate, run-off pressure, old revocation instruction likely flawed (BGH joker).

Tax aspects: selling vs. cancelling

The 12-year rule (§ 20 (1) No. 6 EStG)

For life and pension insurance with signature after 2005: if the policy pays out before 12 years have passed, the entire gain is fully taxed (Abgeltungssteuer 25 % + solidarity surcharge + church tax if applicable).

After 12 years AND from the age of 62 (for contracts after 2012) the half-income procedure (Halbeinkünfteverfahren) kicks in: only half of the gain is taxed at the personal income tax rate.

Practical: if your contract has not run for 12 years yet, examine carefully whether a sale before the deadline makes tax sense. Pro Life accounts for this in the offer.

Contracts before 2005

For "old contracts" (signed up to 31 December 2004), the payout is completely tax-free if the policy ran at least 12 years and contributions were paid for at least 5 years. These contracts are particularly valuable — both for selling and for holding.

Emigrating and the insurance sale

If you are no longer subject to German tax liability at payout, the proceeds can be taxed under a more favourable regime. Examples:

• Portugal NHR status (Non-Habitual Resident, restricted from 2024)
• Spain with the Beckham law (for specific professions)
• Switzerland with lump-sum taxation

Important: complex territory. Consult a tax advisor with cross-border experience before finalising the sale.

Riester subsidy claw-back on emigration

When moving out of the EU/EEA you must repay the Riester state subsidies (§ 95 EStG). That covers allowances plus the tax benefits from the special-expenses deduction. For long-running contracts that can be several thousand euros.

Strategy: for moves out of EU/EEA, sell or pause Riester before the move. For moves inside the EU/EEA (Spain, France, Italy, etc.) the subsidies stay — the contract can continue normally.

Rürup contracts: limited sale

Rürup contracts are statutorily protected as "Basisrente": not pledgeable, not heritable (except to the spouse), not directly redeemable. A classic sale is usually not possible. Instead:

• Pause contributions and wait for the pension start
• Check abroad-payout (often tax-friendlier)
• Termination only in exceptional cases (e.g. insolvency, severe illness)

Pro Life checks case by case whether a special solution is possible on your Rürup contract.

Run-off risk: why waiting gets expensive

A point many do not know: well-known insurers like Generali, Zurich, Athora, Frankfurter Leben, Proxalto, Viridium have sold parts of their life insurance portfolios to run-off companies in recent years. That means your contract is no longer actively managed but only "settled" — often to the policyholder's detriment.

Which insurers are affected?

What does it mean for you?

• Guaranteed interest can come under pressure or be depressed long-term
• Profit participation drops or disappears entirely
• Service and reachability often deteriorate dramatically
• Payout at pension start can be reduced under cost pressure

If your insurer is in run-off or has announced one, selling becomes that much more urgent. Pro Life knows the affected companies and can judge whether quick action is needed.

"I have seen hundreds of times how emigrants simply cancel their life insurance and give away thousands of euros in the process. Especially for older contracts with high guaranteed rates, selling almost always pays off. My advice: let it be reviewed before you cancel. The advice costs nothing — a hasty cancellation can cost you real money." — Oliver Frankfurth

The revocation joker: the underrated legal lever

A central lever Pro Life uses systematically: the Widerrufsjoker (revocation joker). The background is a series of BGH rulings that declared faulty revocation instructions in life insurance contracts void.

What sits behind it?

At signature you receive a revocation instruction — usually in the small print — informing you of your 14-day right of revocation. If this instruction was formulated incorrectly (e.g. unclear deadline calculation, missing mandatory information), it counts as not given. The consequence: you can still revoke today, sometimes decades after signature.

The BGH has confirmed this in several landmark rulings:

• BGH IV ZR 76/11 (2014): "policy-model contracts" 1994–2007 with flawed instructions are revocable
• BGH IV ZR 384/14 (2015): the right of revocation survives even after years of contribution payments if the instruction was flawed
• BGH IV ZR 96/15 (2016): specification of requirements for valid instructions

What does a successful revocation mean?

Instead of just the surrender value, you have a claim to all contributions paid plus compensation for use (notional interest on what the insurer earned with your money). That can double or triple the payout.

Example: EUR 30,000 paid over 20 years, surrender value EUR 32,000 — revocation payout under BGH calculation: EUR 42,000–48,000.

Why does Pro Life check this systematically?

Insurers fight revocations because they are expensive. As an individual you have little chance against the group. Pro Life takes over the economic and legal risk, sues the insurer if necessary and extracts what is legally possible.

That is the actual reason Pro Life can pay you more than the surrender value: they account for additional returns from revocations and back payments.

Why is this so relevant for emigrants?

When you leave Germany and officially deregister, you typically need start-up capital for the new life. At the same time many German contracts no longer make sense after deregistration — or become more expensive because the insurer prices in the "foreign risk".

Selling your life or pension insurance before emigration has four decisive benefits.

1. More capital for the new start: up to 100 % more than a simple cancellation — for older contracts often several thousand euros difference
2. Contract errors get uncovered: the professional review by lawyers and mathematicians reveals claims you would never have spotted with a cancellation
3. Tax optimisation: Pro Life factors in the 12-year rule and the half-income procedure
4. Long-term protection: even after you have moved abroad, further payouts can follow under new case law — Pro Life handles it

Timeline: from first contact to payout

Recommendation: plan at least 8–10 weeks before departure, ideally 12 weeks.

Sell vs. cancel: the direct comparison

When does selling NOT pay off?

Selling instead of cancelling is the better choice in most cases — but not always. The following constellations call for another solution.

1. Contract runtime under 5 years In the early phase the acquisition costs eat the bulk of contributions. The surrender value is low, the sale uplift correspondingly small. Pausing contributions (Beitragsfreistellung) can make more sense — wait for better conditions or the payout phase.

2. Pure term life insurance Term policies without a savings component only pay on death — they have no surrender value. A sale is not possible. The options are cancellation or pause — or keeping the policy, if dependants rely on the cover.

3. Occupational pensions with employer share Direct insurances or pension funds with an active employer share are often not sellable, because they are tied to the employment relationship. Transfer to a new employer or pause is usually the better solution.

4. High-interest old contracts with guaranteed payout Contracts with 4 % guaranteed rate from the 1990s that mature in 5–10 years with a guaranteed payout are the "golden calf" of retirement provision. Calculate before selling: is the guaranteed end payout higher than what Pro Life pays today? If yes, hold.

5. Contract at a financially strong insurer without run-off If your insurer is solid (e.g. Allianz, Cosmos Direkt, R+V) and the policy is well configured, holding can beat selling. Pro Life will tell you that honestly during the consultation.

Rule of thumb: get advice before making a decision. Pro Life will openly say when selling is not the best route for your case.

5 common mistakes when cancelling

Across 40,000+ deregistrations we see the same traps over and over.

Mistake 1: cancelling before the 12-year mark The 12-year rule is the biggest tax trap. Anyone who holds for 11 years and 11 months and then cancels pays the full tax rate on gains. One more month or selling instead of cancelling often saves four- or five-figure amounts.

Mistake 2: ignoring the run-off Anyone who simply lets a Proxalto or Frankfurter Leben contract continue risks shrinking profit participation over decades. Selling monetises the run-off risk.

Mistake 3: not checking the revocation joker Contracts from 1995–2007 frequently have flawed revocation instructions. A plain cancellation leaves this legal lever unused.

Mistake 4: Riester without an emigration check Riester on emigration out of EU/EEA without preparation costs you the complete state subsidy. Sort it before the move.

Mistake 5: starting too late Eight weeks before departure is the floor. Trying to sell two weeks before take-off leaves no time for a serious contract review.

Checklist: before selling

• Request the current surrender value from your insurer
• Do not cancel prematurely — get a review first
• Pull together contract documents (policy, addenda, revocation instruction)
• Request a free offer at Pro Life
• Check whether your insurer is in a run-off (Proxalto, Frankfurter Leben, Athora, Viridium)
• Clarify the tax effects (12-year rule, half-income procedure, foreign tax)
• For Riester: check emigration out of vs. inside EU/EEA
• For Rürup: check for a special solution via Pro Life
• Align timing with your emigration checklist
• Do not forget the rest of your contracts to cancel

Video: selling life insurance before emigrating

Frequently asked questions

Other topics for your emigration plan

• German Pension Refund — statutory pension vs. private insurance
• German State Pension — payout worldwide, tax rules
• Leaving Germany in Retirement — complete guide for retirement abroad
• Expat Health Insurance — cover after deregistration
• How to Deregister from Germany — the formal act
• Leaving Germany Checklist — every step at a glance
• Best Bank Account for Expats — payout account abroad
• Cancel German Contracts — full contract umbrella

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Advertising: this article contains recommendations for our partner Pro Life. The initial consultation is free and non-binding. Pro Life earns only on the uplift over your surrender value.

This article is based on our experience from over 40,000 deregistrations since 2014. It does not replace individual legal or tax advice. Tax statements refer to the German legal position as of 26 May 2026 and can change. For your individual situation we recommend advice from a tax advisor with cross-border experience.

Last updated: 26 May 2026 — no legal advice under the German Legal Services Act (RDG).