Life insurance in the balance sheet check: Allianz and Hannoversche are in the lead, Zurich is at the bottom

Frankfurt. Life insurance continues to lose trust - also because of offers that are difficult to compare and costs that are not very transparent. Professor Hermann Weinmann from the Institute for Finance in Ludwigshafen has therefore long been calling for uniform requirements, especially for state-subsidized products.

For him, the reform of the Riester pension with a standard deposit is a step in the right direction. At the same time, it is likely to increase competition for life insurers: many customers could choose a securities account instead of insurance in the future. “There will be significant shifts in the market,” expects Weinmann.

The prerequisite for stable pension payments is that insurers manage their customers' money well. Weinmann's annual balance sheet check, which appears in the “Magazin für Versicherungswesen” and is available to the Handelsblatt in advance, shows how differently they succeed in doing this.

This time, Weinmann compares the figures of 14 large German life insurers for the year 2025. A business judgment is initially made from various key figures on the earnings situation, operating costs, cancellation losses and valuation reserves. This forms the basis for the consumer rating, in which Weinmann also takes into account the extent to which insurers share with their customers the gross surplus achieved.

The range of results is wide: Allianz Leben and Hannoversche Leben are at the top, each with 900 out of 1000 achievable points and a consumer rating of “very good”. Behind it is the insurer Axa Leben, which increased from 500 points in the previous year to 700 points and now receives a consumer rating of “good”. Alte Leipziger Leben, WWK Leben and, with a slight margin, R+V Leben also received the grade “good”.

Weinmann also sees a significant improvement at Generali Deutschland Leben with a consumer rating of “satisfactory+”. The subsidiary of the Italian insurance giant is now on a par with Bayern-Versicherung. Nürnberger Leben, Volkswohl Bund Leben and Debeka Leben follow closely behind.

Since the previous year, Provinzial Leben has deteriorated with a consumer rating of “adequate”. The Württembergische Leben is just behind it. As in the previous year, Zurich Deutscher Herold brought up the rear with a consumer rating of “poor” – a result that the insurer did not want to comment on when asked by Handelsblatt.

Among other things, Allianz impresses with the lowest operating cost ratio in comparison. It indicates which part of the customer contributions is attributable to the conclusion of the contract, the administration of the contracts and other operational activities. For the market leader it is only 6.3 percent, while Weinmann calculates the highest value for WWK at 19.3 percent.

However, the scientist has observed a decline in operating costs for several providers over a five-year period. The financial regulator Bafin has also observed that the effective costs of unit-linked and hybrid life insurance, a hybrid between classic and unit-linked policies, have fallen since 2021. However, the authorities complain that they are still too high in the most expensive quarter of the market.

It becomes more expensive for insurance customers, especially if they terminate their contract prematurely. The surrender value is often low because the acquisition costs are usually offset against the premiums for the first few years of the contract.

A key figure that is also important to Weinmann is the so-called cancellation loss. Here the number of canceled contracts is compared to the number of new contracts. If many customers terminate their contracts prematurely, it is a signal that they are dissatisfied.

What stands out here are Zurich Deutscher Herold, Nürnberger Leben and Debeka Leben. If you also take the regular processes at Debeka Leben into account, the new business does not compensate for the decline in inventory, criticizes Weinmann.

This development is also reflected in the figures from the General Association of the German Insurance Industry (GDV). In 2025, German life insurers had around 79 million contracts in their portfolio, including 66 million policies that combine savings and risk protection. 20 years ago there were a total of over 94 million contracts.

Hannoversche Leben and Allianz Leben had the lowest cancellation losses in Weinmann's comparison. He also sees improvements compared to the previous year at WWK Leben as well as at Axa, Generali and Alte Leipziger Leben.

Hannoversche and WWK also score points because they are the only two insurers in the analysis with positive valuation reserves in their investments. For all other providers, the hidden burdens continued to rise last year - both in absolute figures and relative to the book value on the balance sheet.

Hidden burdens arise when interest rates rise and the market value of the government and corporate bonds held falls below the book value. Insurers can avoid losses if they hold the securities until maturity - but this comes with a low return. On the other hand, anyone who realizes losses can reinvest the freed-up money at better conditions.

According to a current study by Metzler Ratings, the hidden liabilities at the 30 largest life insurers totaled 92 billion euros in 2025, after around 65 billion euros a year earlier - around ten percent of the managed investments. Due to the further rise in interest rates, they have risen further this year, to an estimated 127 billion euros.

Among the insurers examined by Weinmann, the hidden liabilities make up more than ten percent of the investment portfolio at six companies, namely Volkswohl Bund Leben, Generali Deutschland Leben, Debeka Leben, Alte Leipziger Leben, Württembergische Leben and Zurich Deutscher Herold. Financial instability cannot be automatically deduced from this, says Weinmann. But the earnings potential for many life insurers is limited.