Germany's largest life insurer, Allianz Leben, is not increasing its profit participation any further in the coming year.

The total interest rate for the more modern "Perspektive" tariffs without lifelong interest guarantees will remain at 3.8 percent, as the Allianz subsidiary announced on Monday. For classic policies, it is 3.5 percent, as in the current year. "We have used the rise in interest rates over the past two years to send a strong signal with significant interest rate hikes," said Allianz Life CEO Katja de la Vina. "We can now keep this level stable."

The total interest rate is made up of a regular interest rate of 2.8 percent (for "Perspektive") and 2.7 percent (classic tariffs), the terminal bonus and participation in the valuation reserves. For capital market-related policies, which dominate new business, it only relates to the portion of the capital invested in the security assets; Allianz also offers a total interest rate of 3.8 percent for these policies.

Allianz Leben, which alone accounts for almost a quarter of all life insurance policies sold in Germany, has increased the total interest rate by 0.3 percentage points in each of the last two years. Other life insurers, who had remained more cautious at the time, are now following suit: AXA Leben and its subsidiary DBV, for example, are increasing the current interest rate for 2025 to 3.0 percent from 2.6 percent. Ergo Vorsorge, which belongs to Munich Re, is increasing its rate to 2.8 percent from 2.6 percent. Ergo Leben (formerly Hamburg-Mannheimer), which no longer conducts new business, is increasing its interest rate to 2.7 percent from 2.25 percent.

(Report by Alexander Hübner, edited by Sabine Wollrab. If you have any queries, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and the economy) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)