Germany to Maintain 1% Guaranteed Interest Rate for Life Insurance in 2026

The Deutsche Aktuarvereinigung recommends keeping the rate stable, marking a shift from decades of declines in guaranteed returns.

The Deutsche Aktuarvereinigung (DAV) has suggested the German Finance Ministry maintain the maximum guaranteed interest rate for life insurance policies at 1% in 2026.
This decision follows the first increase in the rate in 30 years, set to take effect in 2025, after decades of steady reductions.
The guaranteed interest rate, also known as the Höchstrechnungszins, is determined by the Finance Ministry based on recommendations from the DAV and financial regulators like BaFin.
Germany has nearly as many life insurance policies as it does residents, with 81.4 million policies recorded in 2023, highlighting their popularity as a savings and retirement tool.
Improving economic conditions since 2022 have boosted overall returns for life insurance customers, including both guaranteed interest and surplus participation.