Accident Annuity (Unfallrente)

Concept

In private accident insurance the accident annuity supplements or replaces the one-off lump-sum disability benefit with a recurring payment. It requires an accident-related degree of disability that reaches the contractually specified threshold; the model conditions leave the figure open, while in practice it is usually 50 per cent and sometimes 35 or 20 per cent. Occurrence, certification and assessment of disability follow the same rules as for the lump-sum benefit, in particular the schedule of disability percentages, time limits and contributory share. The annuity is paid in the agreed monthly amount regardless of how far the degree of disability exceeds the threshold, making it a threshold benefit rather than a percentage benefit.

Commencement, Duration and Adjustment

Under the AUB 2020 payment starts retroactively from the beginning of the month of the accident and continues until the end of the month in which the insured person dies or a reassessment shows the degree of disability has fallen below the threshold; the insurer may request certificates of life. The Austrian model conditions provide for monthly payment in arrears for life and exclude the annuity if the insured person dies from the accident within the first year. Market practice in German individual and group tariffs is a 50 % threshold, sometimes raised to 70 % for accidents from age 60, with reassessment over three years; Austrian tariffs offer tiered variants with a half annuity from 35 % and the full annuity from 50 %, a 20-year payment guarantee and supplements in case of care dependency. Swiss UVG supplementary contracts insure a disability pension topping up the UVG pension, usually limited to AHV retirement age, rather than a threshold annuity.

Delimitation and Practice

The private accident annuity must be distinguished from the disability pension under Swiss mandatory accident insurance (from 10 per cent disability, based on loss of earnings and insured earnings) and from the Austrian AUVA disability pension, both of which are tied to loss of earning capacity. Nor is it an occupational disability pension, since it covers only accident-related disability and not inability to pursue one’s occupation. In advisory practice the accident annuity mainly addresses ongoing additional costs in cases of severe disability; for the insurer its lifelong duration makes it a long-term liability requiring reserving.