Life insurance with a guaranteed interest rate

A guarantee forms the basis of all sensible retirement provision

Low interest rates make it difficult for life insurance. Austrian company s Versicherung is nevertheless maintaining a guaranteed interest rate.

For years, the Austrian Financial Market Authority has been gradually reducing the maximum guaranteed interest rate for life insurance. It is now 1% and some insurance companies no longer offer a guaranteed interest rate. The reason is clear. The historically low level of interest rates makes it difficult to earn the guaranteed return. And that is precisely the point. It is difficult, but not impossible. We will therefore continue to provide a guaranteed interest rate, which we consider to be such an important component of life insurance.

This is because we are convinced that a guaranteed interest rate is a key differentiator in retirement provision. Particularly because there are no alternative products in the financial market that combine a life-long pension with a guaranteed interest rate. We don’t want to lose this unique selling point, as it is the only way we can offer our customers financial security in their retirement provision.

The introduction of Solvency II, however, did not make things easier. Solvency II is a risk-based solvency regime, i.e. the capital requirements of an insurance company are based on the risk it assumes. Giving guarantees to customers is precisely such a risk for the company. Additional capital must be held in reserve to ensure that these guarantee commitments can be met at all times. We accept this higher capital requirement because providing financial security for our customers in their retirement is important to us.

s Versicherung is not only Austria’s largest life insurance company, but also its most successful bank insurance company. We distribute our products through our bank partners, Erste Bank and the Sparkasse banks. This allows us to streamline our costs – which also benefits customers in the end – while allowing our customers to receive high quality advisory services from their trusted advisor.


Manfred Rapf (55) has been CFO of Sparkassen Versicherung AG Vienna Insurance Group since 2005, and Deputy General Manager since 2015. He studied mathematics and computer science, is President of the Austrian Actuarial Association and has been Chairman of the Life Insurance section of the Austrian Insurance Association since 2013.