Can Debt Collectors Seize Loss Of Income Insurance Benefits?

Hi Moneyguru,

Due to some old debts from a failed business venture, I am regularly harassed by debt collectors and have also had assets seized. When I was working, a portion of my salary was automatically seized to repay my debt.

I took out a loss-of-income insurance many years ago and paid the bulk of the premium up front at the time.

I have been disabled for a year now and the insurance claim has finally come through. I will begin receiving benefits soon, plus a back-payment for all the benefits due over the past year.

My question is, will the debt collectors be able to seize the insurance benefits?

I would appreciate any information you can provide.

Thank you

Hi there,

While disability benefits and welfare benefits cannot be seized by debt collectors in Switzerland, debt collectors have the right to seize loss-of-income insurance benefits within certain boundaries.

The same debt collection rules apply to loss-of-income benefits that apply to salaries. Debt collectors can seize loss-of-income benefits, but only the portion which – in combination with your other sources of income – exceeds the minimum existence level defined by the social services of your municipality of residence.

You can find more information on which assets cannot be seized by debt collectors in this forum.

Best regards from Moneyguru

no one can actually harass you because of debts, address to an agency of lawyers who are working against debt collector complaints

Debt collectors typically cannot seize loss of income insurance benefits. These benefits are designed to provide financial support to individuals who have lost their income due to illness, injury, or other covered reasons. In many jurisdictions, loss of income insurance benefits are considered exempt from debt collection proceedings, as they are intended to safeguard the insured's financial stability during difficult times. However, it's essential to consult with legal experts or review local laws to understand specific protections in place regarding debt collection and insurance benefits.