FAQ

Here are the answers to some frequently asked questions.

1. Who can rescind?

Any consumer who took out a life insurance policy between January 1st, 1995 and December 31st, 2007, and was not fully and/or properly informed about its contractual conditions or revocation deadline, can rescind the policy. This applies if the consumer receives no documentation at all, or if the documentation was incomplete. Necessary information includes general consumer guidance and clear notification of a rescission deadline, which may not be hidden in small-print. If you have already canceled your policy and are expecting losses as a result, you can also make a claim.

2. Why rescind instead of canceling?

If you cancel your life or pension insurance, you will only be given back some of the premiums you paid in. This is known as the surrender value. If your policy was concluded between January 1st, 1995 and December 31st, 2007, and if you were not fully and/or correctly informed about its contractual conditions, especially the revocation deadline, then your life insurance can be rescinded in full. This means you have the right not only to its surrender value but also to repayment of any premiums you paid in, plus compensation for use. This is why a rescission is an attractive option for many consumers.

3. How much money will I get back?

If you have the right to object because of incorrect guidance, then, in the view of the Federal Court of Justice (Bundesgerichtshof, BGH), your policy will be eligible for a full rescission. This means that the insurance company must repay not only the surrender value, but also any sales and administration costs, plus interest (compensation for use). Exactly how much that is will depend on the premiums you have paid in your particular case. As part of our free initial assessment, we will gladly calculate the amount of compensation for use you can realistically expect.

4. Can I do this without legal expenses insurance?

Yes, we believe that the rescission of an incorrectly issued life or pension insurance should not depend on whether or not you have legal insurance. In this case, we offer our clients Service Models B and D. If an initial valuation indicates that a repeal has a good chance of success, we will cover for you the legal costs of both Service Models. You do not need legal insurance for this. Our new Service Model D even allows you to receive an initial payment of your compensation for use after as soon as approximately six weeks. We will be happy to help you with any questions about choosing the right model.

5. Are the costs transparent?

The costs will always be made clear to you. Our service is free of charge; there will only be a fee upon successful conclusion, and this will be based on the compensation for use you get because of our service. We will inform you about the potential costs before an attorney starts working for you. These costs will usually be covered by your legal expenses insurance. We offer special service models for other situations.

6. What will it cost me to commission FACTO?

If the valuation of your documentation shows that there is a predominant chance of success for the repeal, then you can rescind your life insurance policy fully through FACTO. Before the attorney starts working for you, we will inform you about the costs incurred. These costs will usually be covered by your legal insurance. If successful, we will receive a fee that is a percentage of the surplus value obtained. We will discuss with you beforehand how much this could potentially be – and the costs will always be clear to you. If you do not have legal insurance, we can still enable a rescission using our Service Models B and D. With Model D, you will be able to receive an initial payment of your compensation for use after as soon as approximately six weeks. Feel free to ask us about this.

7. What kind of insurance policies can be rescinded?

FACTO can assess any life or pension insurance (conventional or equity-linked), which was concluded between January 1st, 1995 and December 31st, 2007 and which is still ongoing, has already been canceled, or has expired. Funded policies such as ‘Riester’ and ‘Rürup’ retirement plans cannot be assessed, nor can company schemes or insurance policies that cover only a risk, such as a pure term life insurance policy.

8. Can policies that have already been canceled or expired still be rescinded?

Verdicts issued by the European Court of Justice and Federal Court of Justice stipulate that any life or pension insurance that does not contain proper revocation instructions in its documentation or insurance certificate can be fully rescinded. This also applies to policies that have already been canceled or which have expired.

9. What documents does FACTO need to assess my case?

Our local sales partner will inspect your documentation together with you, and help you to organize any missing documents or information. Exactly which documents they may be will depend on your particular case. Generally speaking, in order to assess your right to object, we need the application form, the policy letter, an original certificate of insurance, and consumer information. But even if some of the documents are no longer traceable, we can often still achieve a rescission. That is something we will check in our free, non-binding initial assessment.

10. Are there taxation issues to be taken into account?

In some instances, repealing a policy or generating surplus value can lead to taxation. FACTO is not authorized to issue tax-related information or advise customers regarding taxation. We therefore strongly recommend that you have your tax consultant examine a rescission for any taxation repercussions.

11. I have more than one policy. Is it the same for me?

If you have more than one policy, then you can submit them to us together. The attorneys we commission will require separate mandates for each, which you will receive from us in advance.

12. What will happen to my original documents?

We will only need your original documents if we assess your case as potentially positive. We will then give these documents to the attorneys we commission. Once your rescission has been successfully completed, you will of course get them back.

13. Will my case definitely go to court?

We always begin by trying to reach an out-of-court settlement with your insurance company. But if we cannot, or if we expect the resolution to be unsatisfactory, then the attorney we commission will institute proceedings. The attorney will act on your behalf and request the rescission of the policy, repayment of all premiums, and compensation for use.

14. Can I, and do I have to, appear in court personally?

If you are not ordered to appear in court, then you do not have to participate in the proceedings, as your specialized attorney will hold full powers to represent you.

15. How long does a rescission take?

This can vary a lot depending on the type of policy, the company involved, and the place of jurisdiction. We normally expect a rescission to take at least 18 to 24 months to process. With our new Service Model D, you now benefit from an immediate payout: After as soon as approximately six weeks, up to 20 percent of the calculated surplus value will be transferred to your account.

16. Will my legal expenses insurance pay the FACTO fee and attorneys’ fees?

Ideally, you will have legal expenses insurance that covers private contract law – which most policies do. The attorneys’ fees will then be covered by your legal expenses insurance. FACTO only receives a fee if successful. Its remuneration is a percentage of the compensation for use obtained. You do not pay anything.

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