Liability insurance in Germany: Essentials
- According to the law, you are liable unlimitedly for damage you cause to other people or their property.
- Personal liability insurance protects you against the financial consequences of personal injury, property damage, and economic loss. It also covers damage caused by gross negligence, which refers to a severe lack of care significantly below the standard of care expected from a reasonable person. There are no waiting periods for this insurance.
- The minimum sum insured for personal liability should be at least €10 million; the maximum insurance cover is €50 million. Reasonable tariffs today usually offer the maximum sum insured.
- Some risks cannot be insured with personal liability insurance, but particular liability policies are required. For instance, if you own a dog, you would need dog liability insurance to cover any damages it might cause.
- Good personal liability insurance can be secured for as little as €5 per month, making it an affordable and practical solution for financial protection.
- Fintech insurers Feather and Getsafe offer particularly high-performance liability insurance for private consumers. This includes comprehensive coverage for personal injury, property damage, and financial loss, as well as additional benefits such as legal protection and worldwide coverage.
Benefits of personal liability insurance
Personal liability insurance insures you against personal injury, property damage, and financial loss that you cause to third parties:
- Personal injuries
These damages are injuries, damage to health, or the death of people caused by the loss event. They often lead to remarkably high claims for compensation. Anyone who causes personal injury must not only bear medical costs but also costs for compensation for pain and suffering and loss of earnings. In the worst-case scenario, you must pay the insured person a lifelong pension. The party responsible for the damage must also pay benefits from private disability insurance or statutory pension insurance. - Property damage
Property damage is caused by the destruction of or damage to property. Its importance should be more frequently considered. Damage to buildings, vehicles, and expensive consumer goods can lead to high claims amounts. - Financial loss
All losses that are neither personal injury nor property damage are considered financial or monetary losses. Insurance providers differentiate between genuine and non-genuine financial loss. Genuine financial loss has no connection to personal injury or property damage. For example, if a third party’s negligence causes you to miss a flight, resulting in a significant financial loss, this would be considered genuine. On the other hand, non-genuine financial loss is directly related to personal injury or property damage.
Insured individuals
Personal liability insurance can be taken out in single or family tariffs.
Family tariffs also cover other people living in the same household, including family members and unmarried partners.
Adult, unmarried children in their first post-school education who do not live with their parents are automatically insured with their parent’s policy.
Married couples and unmarried partners can also be insured under a joint policy if they live in separate households.
The insurance cover of private liability insurance also extends to people privately employed in the policyholder’s household if they cause damage to third parties during their work.
Liability insurance cover abroad
Personal liability insurance also covers claims for damages abroad. Within the EU, policy coverage is unlimited. Worldwide coverage is usually valid for 1 to 5 years, depending on the insurance provider and the chosen tariff.
Passive legal protection through private liability insurance
One of the advantages of private liability insurance is that it offers passive legal protection in the event of a claim. The insurance company checks damage claims and defends against unjustified claims.
If a claim for damages results in a legal dispute between you and the injured party, the liability insurance will not reimburse the costs. It would help if you had separate legal protection insurance for this.
Claims settlement in private liability insurance
Liability insurance provides comprehensive compensation benefits in the event of personal injury. This includes reimbursing medical treatment, all other costs for restoring health and the ability to work, compensation for pain and suffering, loss of earnings, and permanent pension payments. The insurance also covers medical aid, rehabilitation, and nursing staff costs. The claims settlement process typically involves submitting a claim form, providing supporting documents, and waiting for the insurance company to review and approve the claim.
Total property damage is insured at current value (replacement value, considering age and wear and tear). The insurance reimburses the repair costs and pays a depreciation surcharge for all other property damage.
All liability insurance policies in Germany cover non-genuine financial loss related to property damage or personal injury, with a maximum sum insured. On the other hand, many providers only insure actual monetary losses for a lower sum.
Liability insurance coverage
Personal liability insurance covers numerous risks in everyday life. The insurance cover applies to all damage caused by you or a person insured under your policy to third parties. This damage can be caused through no fault of your own or straightforward or gross negligence. However, some damage does not automatically fall under personal liability insurance cover in Germany. In some cases, they require separate liability policies.
Damages that cannot be insured under private liability are:
- Damage caused intentionally
- Damage in connection with a criminal offense
- Damage caused by the breach of contractual obligations
- Damage caused by dogs or horses (damage caused by small animals, birds, and cats is covered by private liability insurance in Germany)
- Damage to property belonging to the insured person (including glass damage in the insured person’s own home)
- Damage that falls within the scope of motor vehicle liability, professional liability, or animal liability insurance.
Criteria for choosing the right private liability policy
The following criteria are critical when choosing a good liability insurance policy:
- Sum insured
What your liability insurance will reimburse in the event of a claim depends on the sum insured under the policy. The minimum sum insured should be at least €10 million in all three insurance areas. However, we recommend taking out liability insurance for more than €50 million — the price difference to tariffs with lower sums insured is small. If the sum insured is too low, this can result in a considerable financial risk, as unlimited liability is prescribed by law. - Best performance guarantee
Insurance companies that offer the best performance guarantee for their liability insurance undertake to provide the same benefits as the best German liability insurance provider. If your insurance refuses to settle a claim, and you can prove that another insurance company covers this claim, you can demand that your insurer provide the same benefits. - Bad debts
If your claims for damages are not covered by third-party liability insurance and the party responsible for the damage cannot pay, you risk losing a lot of money. After all, 15% of all households in Germany do not have liability insurance. Your liability insurance will pay for such damage if it covers bad debts. - Insurance for damages caused by courtesy
Good liability insurance also covers damages caused by courtesy — for example, unpaid help with a move. - Co-insurance of damage caused by younger children
Under German law, children up to the age of 7 (up to the age of 10 in the case of damage caused in moving traffic) are not liable for damage caused by them. If you have children, your liability policy should also cover damage caused by them. - New risks
New risks for which separate liability policies must be taken out should be included in your personal liability insurance for a specific time at no extra charge. In practice, dog liability insurance plays here a vital role.
Costs for liability insurance in Germany
Various factors influence the cost of liability insurance in Germany. These include the tariff, the sum insured, the number of insured people, and, in some cases, their age.
A reasonable single rate starts from as little as €5 per month. However, if several people are to be insured, a slightly more expensive family tariff is always the cheaper solution.
In Germany, personal liability insurance can be taken out with or without an excess. However, we recommend choosing a tariff without excess due to the low prices.
Best liability insurance in Germany
Most insurance companies in Germany also offer personal liability insurance. We consider the insurance policies from FinTech providers Feather and Getsafe to be particularly recommendable.
Both insurance companies have established themselves as providers of modern digital insurance. In addition to private liability insurance, they offer various other types of insurance, including private health insurance, household contents insurance, dog liability insurance, and pet health insurance for cats and dogs.
The two insurance providers offer transparent, favorable conditions and specialize in the requirements of expats in Germany. They operate their websites and mobile apps in German and English, and consultations can be held entirely in English.
If you have opted for personal liability insurance from Feather or Getsafe, you can apply for the policy online in just a few minutes. You can also complete the claims process entirely online.
Personal liability insurance from Feather
- From €4.94 per month
- Sum insured: €50 million
- Single and family tariffs (you can insure your spouse or partner as well as children and parents)
- Worldwide insurance coverage
- Best Coverage Guarantee
- Lost keys coverage
Personal liability insurance from Getsafe
- From €2.94 per month
- Sum insured: €20 million (Standard plan) or €50 million (Premium plan)
- Single plan or household insurance for all people living in the same household
- Worldwide insurance coverage
- Bad debt coverage (unlimited sum insured, even for damage caused intentionally by third parties)
- Coverage of losses in connection with volunteering, a part-time job, or part-time self-employment
- Lost keys coverage
- No best coverage guarantee, but a pervasive contractually guaranteed scope of benefits
Conclusion
It would be best if you took out liability insurance in Germany. It is one of the most essential forms of insurance. Without this cover, you will have to pay unlimited compensation claims from third parties out of your pocket, which can threaten your livelihood in the event of significant damages.
We particularly recommend the digital liability insurance policies from Feather and Getsafe, which impress with their high-performing benefits and favorable and transparent conditions.
Frequently Asked Questions — FAQ
No, there is no legal obligation to take out private liability insurance in Germany. However, motor vehicle liability insurance for all vehicle owners, professional liability insurance for specific freelancers and the self-employed, and — in some cases — dog liability insurance are required by law.
In the event of an insured event, you are obliged to report the damage to your liability insurance company immediately. You jeopardize your insurance coverage if you pay compensation or accept claims for damages from the injured party without the insurance company’s written consent.
Yes, but only after a severe claim. You also have the right to extraordinary termination if the insurance company increases the premiums after a claim.