FRANKFURT (dpa-AFX) - Financial regulator Bafin wants to put a stop to excessive costs in life insurance. "The aim is to prevent or stop excesses in commission-based sales," Germany's top insurance supervisor Frank Grund said Monday. Accordingly, capital-forming life insurance policies should offer appropriate customer benefits. In addition, conflicts of interest in the sale of these products should be avoided. Consumer protectors had often criticized commissions for the old-age provision classic as too high.

The supervisory authority is taking a closer look at insurers whose effective costs for endowment life insurance policies are very high compared with the rest of the industry. The effective costs indicate how the costs of the respective contract affect the return. Insurers whose expenses for intermediaries are conspicuously high are also subject to closer scrutiny.

Bafin published a fact sheet on Monday. According to it, life insurers must achieve return targets with sufficient probability. When setting targets, insurers should distinguish between a positive return after costs (nominal) and real success, i.e. a positive return after costs and inflation.

In an investigation, the supervisory authority had found a "considerable spread" in particular of distribution costs among life insurers. The return on the old-age provision classic refers only to the savings portion after deduction of acquisition and administrative costs, among other things./mar/DP/ngu