ERGO Risk Report 2018

Less risk, more state control – how the Germans tick.

ERGO Risk Report 2018

Media Information, 14.02.2018

The ERGO Risk Report 2018 is the first in a series of surveys that is to provide information on risk literacy and personal responsibility among Germans. This representative survey was conducted under the scientific direction of Professor Gerd Gigerenzer, Director of the Harding Center for Risk Literacy at the Max Planck Institute for Human Development. A new edition of the survey is scheduled for publication every two years, each concentrating on a different topic. The current report focuses on the subject of providing for old age.

  • Inadequate old-age provision: 42 percent of Germans put aside nothing or less than 50 euros a month for personal old-age provision. Every fourth German fears poverty in old age.
  • Vague fears: 68 percent of Germans are afraid of war and terror, a majority calling for stricter laws and more police. Every fourth respondent is of the opinion that personal provision should be obligatory. Most of the population would also like a traffic-light food rating system as a guide.
  • Lack of risk literacy: Participants were presented with five questions relating to health risks and the potential offered by financial investments, whereby the respondents frequently misjudged their situation.

Survey focus on old-age provision - many Germans fear poverty in their old age, especially women

Concerns. Almost every fifth German is afraid of old age. Only 4 percent of the respondents stated that they were looking forward to their old age, a significantly higher figure being recorded solely among civil servants (12 percent). The greatest concerns among respondents were illness (65 percent), lack of mental capacity, i.e. dependence on others (41 percent), poverty (40 percent) and loneliness (28 percent). Almost seven out of ten respondents expect a continuing drop in the level of pensions level over the next ten years. Every fourth German is in favour of personal provision for old age being made obligatory.
Only every fifth German states that they really know the exact amount of their future pension. 43 percent of women are uncertain and say that they can only roughly estimate how much pension they are likely to receive. Whereas every third man states that he cannot afford to make personal provision for old age, the relevant figure is as high as 43 percent among women.
Federal states. Every second German believes they will have to reduce their financial outlay during retirement.
In this case, the differences between East and West are considerable, this concern being much more pronounced in the new federal states, e.g. in Mecklenburg-Western Pomerania (65 percent), Saxony (67 percent) and Brandenburg (69 percent). By comparison, a significantly lower figure is however reported in Bavaria and Hesse, reaching 47 percent in each case.
Hopes and wishes. The Germans set their highest hopes on medical progress (49 percent). In reply to the question of what Germans were looking forward to in their old age, they mainly cited more time for leisure activities (48 percent), family and partner (43 percent) and less stress (41 percent). Every fifth respondent would like to take early retirement.

Security - vague fear of war and terror prevalent in Germany

Although a large majority of the respondents consider the danger arising from terrorism to be very low, a vague fear of war and terror prevails among 68 percent of the Germans. This results in demands for a strong state, with a majority wanting police reinforcement and stricter laws.
A discrepancy between awareness of danger and a readiness to make appropriate provision is evident in the case of data protection. "It is interesting to note that although Germans are afraid of cyber attacks and piracy, only every third respondent regularly changes their password. Two out of ten have – against their better judgement – even used insecure, public Wi-Fi connections for banking transactions," reports Gerd Gigerenzer, Professor and Director of the Harding Center for Risk Literacy.

Health - the Germans rely on a positive attitude to life

With regard to their health, Germans are optimistic and have faith in medical progress. Almost every third respondent believes that positive thinking can prolong one´s life. Only every fourth person thinks that sport and exercise can have the same effect. By contrast, risks such as poor diet and the consumption of nicotine are sometimes significantly underestimated.
Two thirds of the respondents fear serious illnesses, such as cancer, dementia and heart attacks. "In this case, it is interesting that the fear of serious illnesses increases with the level of income. Affluence evidently provides no reassurance when it comes to cancer, dementia or heart attacks," notes Professor Gigerenzer.
The Germans would also like more political regulation in the health sector. For instance, 68 percent would like a health traffic-light system for food to provide for quick orientation.

Money - many Germans fear another financial crisis and are keeping to conservative types of Investment

In the case of financial investments, the Germans´ need for security dominates. One third of the Germans have consequently invested in property as a provision for old age. Every second respondent believes that a financial crisis similar to that in 2008 will recur within the next ten years. Although two thirds believe that the highest returns are generated with shares and funds, they prefer to deposit their money in savings accounts or opt for security-oriented pension products. The Germans also prove to be traditional as far as payment methods are concerned, an overwhelming majority (93 percent) wanting to hold on to cash.
In terms of financial fears, attention is focused on the threat scenarios of "old-age poverty" and "care dependency". According to the survey, 22 percent of Germans put aside nothing and a further 20 percent a maximum of 50 euros a month for personal old-age provisions.
"That so many people make no personal provision is an alarming result for society. Even with small amounts, it is possible – on a long-term basis – to put together a reasonable pension. It is necessary to make a sound plan for old age at the earliest possible stage in one´s working life," says Michael Fauser, Chief Executive Officer at ERGO Lebensversicherung AG.

Digitisation - one quarter of the Germans are afraid of being replaced by machines

25 percent of those taking part in the survey fear losing their job to robots and machines in the course of the next ten years. Civil servants do not however see this as a risk (87 percent).
8 percent of the respondents cite the danger of losing their job as the greatest personal risk resulting from the future digitisation scenario. The risks of identity theft, cyber attacks and data loss are however considered to be much higher by Germans (more than 50 percent in each case).
In spite of this, they are at times careless in protecting their data. 39 percent of Germans are also afraid of alienation as a result of new technologies. At the same time, 58 percent find that digital media make it easier to maintain contact with friends and family. 87 percent of the respondents make active use of the internet for research, purchases, online banking and social interaction and see their life as being simplified by digital advances.
On the other hand, intelligent assistance systems, e.g. for household tasks, have met with little acceptance so far. As yet, only two out of ten respondents feel at ease in a so-called "smart home".

Risk literacy - respondents misjudge many risks

The responses to guesstimate questions included in the survey show that, for the most part, Germans misjudge risks. The number of people suffering from dementia in Germany was, for instance, overestimated fivefold and the prevalence of obesity twofold. By contrast, 86 percent of the Germans underestimated the negative impact of smoking on statistical life expectancy. A lack of risk literacy can also, e.g. in the case of financial matters, have fatal repercussions. "If, for instance, the potential opportunities offered by shares are underestimated to the extent evident among our survey participants, many people quite possibly opt for the wrong investment strategy – and consequently have to reckon with poor results," explains Michael Fauser. Men estimated the sample risks better than women, older respondents better than younger ones and people with higher educational qualifications better than those with lower levels.

ERGO Risk Report 2018 in brief
Scientific director Professor Dr. Gerd Gigerenzer, Harding Center for Risk Literacy / Max Planck Institute for Human Development
Online Survey Heute und Morgen Market Research Institute, Cologne (Germany)
Number of respondents 3,200 in total; of which 200 from each federal state
Survey period 7. to 20.9.2017
Publication, charts ERGO Risk Report 2018 "On the risk literacy and personal responsibility of the Germans", 72 pages
More Information and PDF file available to download at (German version)
ERGO Risk Report 2018
Download ERGO Risk Report 2018

Read all questions and answers about risk literacy and personal responsibility on the topics of old-age, money, health, security and digitization.

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About the ERGO Group AG

ERGO is one of the major insurance groups in Germany and Europe. Worldwide, the Group is represented in over 30 countries and concentrates on Europe and Asia. Within the group, three entities manage domestic and international business, as well as digital and direct business (ERGO Deutschland, ERGO International and ERGO Digital Ventures). About 44,000 people work for the Group, either as salaried employees or as full-time self-employed sales representatives. In 2016, ERGO recorded a premium income of 17 billion euros and rendered benefits to customers of 16 billion euros. ERGO is part of Munich Re, one of the world's leading reinsurers and risk carriers.
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