swiss insurance useful crucial or unnecessary

Insurance: Useful, Crucial or Unnecessary?

Which insurance policies do you really need in Switzerland? Which are a waste of money? The moneyland.ch team helps you answer this question through this guide.

When compared to residents of other countries, Swiss have an exceptionally low tolerance for risk. According to a study by Swiss Re, the Swiss are world leaders in insurance premium payments.

So it’s no wonder that Switzerland is a bona fide Eldorado for insurance companies. Even quirky insurance coverages like hole-in-one or volcano insurance are available.

But which insurance coverages do you really need? It’s obvious that not all of the insurance policies on the Swiss market provide coverage that you will actually use in everyday life. On top of that, many Swiss consumers have overlapping insurance policies and therefore spend more on premiums than necessary.

The only insurance that is really necessary is coverage against hazards which could actually threaten your existence. Here, moneyland.ch lists the most important Swiss insurance types, and rates them based on their usefulness.

1. Health insurance

There is no way to get around health insurance. Swiss residents are required by law to take out basic health insurance coverage. It covers the most important healthcare costs both in Switzerland and abroad.

Compulsory health insurance is expensive, so a regular premium comparison is recommended. If you have a very low income, you may be eligible for premium reductions.

You can obtain additional health insurance coverage by taking out optional supplementary insurance (more on this below). Depending on your personal situation and needs, getting this coverage can pay off.

Verdict: Compulsory.
Cost: Expensive.

2. Liability insurance

Private liability insurance covers the cost of damages which you are held liable for. Depending on the damage or accident and its consequences, your liabilities can be exorbitant high and ruin you financially, unless you are insured.

A private liability insurance policy is definitely recommended. Typically, this insurance is bundled with household insurance. Premiums are relatively affordable.

Verdict: Highly recommended.
Cost: Moderate.

3. Household insurance

Household insurance covers certain damages to your personal property kept in your home. You can also insure personal property which you take with you when you leave home, such as your bicycle or laptop.

Household insurance is usually bundled with liability insurance. Because covered damages can be very expensive and household insurance premiums are relatively low, this insurance offers good value for money in most cases.

Exception: If you (as a student in a shared flat, for example) don’t own any valuable items, you don’t necessarily need household insurance.

Verdict: Recommended in most cases.
Cost: Moderate.

4. Car and motorcycle insurance: Liability coverage

Liability car insurance is compulsory for all motorcar drivers. The same holds true for motorcycle liability insurance in the case of motorcycle drivers. This insurance covers damages to third parties caused by your car or bike.

The passenger accident insurance offered by insurers is not necessary if you already have accident insurance coverage through your health insurance policy or your employer’s accident insurance.

Verdict: Compulsory for drivers.
Cost: Expensive.

5. Car and motorcycle insurance: Comprehensive coverage

Comprehensive and fully comprehensive auto insurance are not compulsory. Comprehensive auto insurance can provide useful coverage, except in the case of old cars with little resale value. However, the more expensive fully comprehensive insurance no longer makes sense in most cases. Cars that are already several years old will normally be adequately covered by standard comprehensive car insurance.

Verdict: Not always necessary.
Cost: Expensive.

6. Life insurance: Death benefits

If you have dependents which may find it difficult to live without your support in the event of your death, getting life insurance which pays out a death benefit can be worth it. If you don’t, getting this kind of life insurance is normally unnecessary.

Verdict: Recommended in some situations.
Cost: On the expensive side.

7. Life insurance: Savings

Aside from policies that insure your dependents against your possible death, there are also several different kinds of life insurance plans designed to help you save. These are rarely worth it. Life insurance which combines a death benefit with a savings plan is also generally not recommended.

Verdict: Normally not recommended.
Cost: On the expensive side.

8. Travel insurance

Getting travel insurance coverage for low-cost trips normally isn’t worth it. You can insure your luggage through your household insurance. If you travel regularly or are planning an expensive trip, however, getting an annual travel insurance policy is a smart thing to do. If you only need coverage for a single, short trip, you could consider getting a cheaper, short-term travel insurance policy.

Verdict: Recommended in some cases.
Cost: Moderate.

9. Pet insurance

Even pet healthcare expenses can knock a hole in your wallet. Unfortunately, pet insurance isn’t exactly cheap and it doesn’t always pay off. Comparing costs and coverage is difficult because there are so many variables.

To help you find out whether a cat insurance or dog insurance policy could help you save, moneyland.ch developed a special pet insurance comparison which shows the best available policies from each insurer. Additionally, it shows you whether or not the best policies actually pay off in relation to your pet healthcare spending.

Verdict: Not always recommended.
Cost: On the expensive side.

10. Legal expenses insurance

There are two main kinds of legal expenses insurance: Private legal expenses insurance and driver’s legal protection insurance. But legal insurance does not automatically pay off. You need to know exactly what risks you want to protect yourself from using legal expenses insurance.

Before signing up, you need to make sure that the policy actually covers the risks you are concerned about. The legal expenses insurance comparison from moneyland.ch can help you find the policy which provides the coverage you need and compare premiums. You can easily filter and sort results based on the coverage provided.

Verdict: Recommended in some cases.
Cost: Relatively expensive.

11. Supplementary Outpatient insurance

Outpatient insurance is offered by health insurance providers and is normally bundled with various other supplementary coverages. These may include benefits towards the cost of gym memberships, ambulance transportation, alternative medicine, medication, healthcare outside of Switzerland, eyeglasses and contact lenses or corrective dental care.

You normally will not need all of the supplemental coverage you get in a bundled package. Before signing up, ask yourself which coverage you really need (both regularly and in an emergency) and whether the cost to value ratio adds up in your specific case.

Verdict: Recommended in some cases.
Cost: Moderate to expensive.

12. Supplementary hospital insurance

There are three main types of hospital insurance in Switzerland: general ward, semi-private ward and private ward. Additionally, there is a “flex” model which lets you spontaneously choose which ward you will receive treatment in.

The supplementary insurance for semi-private and private wards, and the free selection of doctors that come with it, is generally expensive. It’s only worth getting this insurance if choosing your doctor and receiving treatment in a two-bed shared room or a fully private room is important to you.

Verdict: Not always recommended.
Cost: Expensive.

13. Mobile phone insurance

Mobile phone insurance policies are relatively expensive and don’t cover all possible hazards. Theft normally isn’t covered. Paying for a phone repair yourself may work out cheaper than paying premiums for mobile phone insurance. You can find out more here.

Verdict: Usually unnecessary.
Cost: Relatively expensive.

Individual insurance comparison

For more complex insurance policies in particular, the only sure way to judge whether or not you can benefit is through an exact analysis of your needs and your risk profile. Feel free to contact the moneyland.ch team for no-strings-attached assistance in making your insurance decisions.

Once you’ve determined your exact needs, you can compare policies based on the benefits and costs attached. Differences between insurance providers are often major.

The moneyland.ch team

More on this topic:
Over insurance: What does it mean?
Overlapping insurance: How to avoid it.

About Moneyland Magazine

The moneyland.ch magazine provides accurate, unbiased information on topics related to finance and money. In addition to research and expert interviews, the magazine contains numerous financial guides.