Liability Insurance in Germany
- According to the law, you are liable to an unlimited extent for damage you cause to other people or their property.
- Liability insurance covers claims for compensation for personal damage, property damage and monetary loss. Damage caused by gross negligence is also covered by the policy.
- The sum insured under liability insurance should be at least €10 million. However, policies with a maximum sum insured of €50 million are better.
- You can purchase high-performance private liability insurance for as little as €5 per month.
- Waiting periods are not provided for in this insurance.
- Some areas of liability are not covered by personal liability insurances but require separate insurance policies. These include, for example, damage caused by your dog or using your own motor vehicle, as well as damage that falls within the scope of professional liability.
- The insurance providers Feather and Getsafe offer the best liability insurance for expats in Germany.
What is liability insurance?
Private liability insurance covers all the risks of everyday life. It offers comprehensive insurance cover for damage caused by you or another person insured under your liability policy.
Covered are property damage, personal damage and monetary loss:
Loss categories in liability insurance
Property damage is caused by damage to or destruction of property. The extent of these damages in liability insurance is often underestimated. It is not only small, everyday damage such as a red wine stain on a carpet or expensive clothing. For example, negligently caused damage to buildings or vehicles can result in exceedingly high compensation claims.
Personal damage is given if the damaging event leads to injuries, health impairments or the death of people. Compensation for personal damages can be particularly expensive. For example: a person is seriously injured due to negligent behavior. In addition, it later transpires that he can no longer conduct his profession due to the injury and must retire. In such a case, claims for compensation include not only medical costs, but also compensation for pain and suffering, pension payments, loss of earnings and benefits from statutory pension insurance or private disability insurance.
Monetary losses are all losses that are neither property damages nor personal damages. Insurers differentiate here between genuine and non-genuine financial losses. Genuine monetary loss is not related to personal or property damages. It occurs, for example, if a person misses a flight to a business meeting due to a fault of the insured person — thus, a lucrative contract is not concluded.
Every liability insurance Germany covers non-genuine financial losses up to the policy’s cover amount. However, some providers cover genuine financial losses only to a limited extent.
Who can be insured with personal liability insurance?
Liability insurance can be taken out for singles and families.
In a single tariff, the insurance cover only extends to the policyholder. In family tariffs, family members, unmarried partners, and all other people living together in the same household can be insured. Depending on the insurer and tariff, joint liability insurance is sometimes also possible if the insured persons do not live in the same household. All policyholders should be listed by name in the insurance contract.
Unmarried adult children who no longer live at home, and absolve their first education after school, are always covered by their parents’ liability policy.
Liability insurance cover also includes people, who are employed by the policyholder on a private basis, for example as domestic staff, gardeners, or au pairs. If they cause damage to third parties in the course of their work, private liability insurance also covers this.
Private liability insurance Germany abroad
If you have taken out a private liability policy, you are covered against claims for damages not only in Germany but also abroad. Personal liability insurance offers worldwide coverage. In Europe, it is unlimited, but outside Europe there are often limits between 1 up to 5 years.
Before a longer stay abroad, you should clarify with your company what you need to do in the event of a claim.
Passive legal protection
Private liability insurance provides you with passive legal protection in the event of a claim. The insurer checks whether the injured party’s claims are justified and defends against unjustified claims.
The following rules therefore apply to the settlement of claims:
- In the event of property damages, the repair costs are reimbursed. In addition, the insurance pays a surcharge for the reduction in value of the item.
- In the event of total loss, the insurance will reimburse the current value of the insured item. This is the replacement value of the item, considering wear and tear and age.
- In contrast, private liability insurance provides comprehensive compensation for personal damages. It reimburses hospital costs and medical costs, other costs for alleviating suffering and restoring the ability to work, compensation for pain and suffering, loss of earnings including permanent pension payments and other costs. Other costs are, for example, expenses for medical aids and appliances or nursing staff.
What does liability insurance cover?
Personal liability insurance cover refers to all third-party damage that may occur in everyday life. However, separate liability insurances must be taken out for damages in a professional context, damages because of driving your own motor vehicle on the road and some other insurance events.
Compensation through private liability insurance
In principle, private liability insurance in Germany only reimburses damages if they were not caused intentionally. Gross negligence, on the other hand, does not justify an exclusion of benefits in the case of a good tariff. German personal liability insurance covers:
- Damages related to breach of the duty to supervise minors
- Damages caused by the breach of traffic safety obligations (e.g., snow clearing and gritting)
- Damages caused by pedestrians and cyclists (also with electric bicycles or scooters, if no driving license is required for their use)
- Damages during events and private sporting activities
- Damage caused by own borrowed surfboards, rowing, paddle or sailing boats
- Damages related to owner-occupied property (condominiums, rental apartments, vacation apartments and vacation homes)
- Damages related to communal property/shared areas in residential complexes
- Damages in a hotel room
- Lost keys or key cards of a rented apartment or in a professional context
- Damages caused by the building owner during conversion measures with a construction sum of at least €20,000
- Damages resulting from the provision, transmission, and exchange of electronic data (e.g., damage caused by computer viruses)
- Water damages caused by common household substances such as varnishes, paints, or heating oil up to 50 kilograms.
Private liability insurance — criteria for selection of the policy
The following aspects are important when choosing a liability insurance policy:
You will receive benefits from your insurance provider up to the agreed sum insured. The sum insured should be at least 10 million euros and cover all three areas of the insurance at this level.
It is better to take out a policy with a sum insured of 50 million euros. The difference in cost compared to insurance policies with a lower sum insured is so small that it can be ignored. With a sum insured of this amount, you are comprehensively covered. If, on the other hand, you choose a policy with a sum insured that is too low, there is a financial risk because the law provides for unlimited liability.
Best performance guarantee
Some insurance companies offer the best performance guarantee for liability insurance. The company provides then the same benefits as the best liability insurer in Germany.
This guarantee is important if you have caused a claim, and your provider argues that this area of insurance is not covered or that the sum insured is not sufficient to settle the claim in full. If you can prove that another insurance company will pay for this damage, this also applies to your policy with the best benefit guarantee. Thus, you are covered at the highest liability insurance level available in Germany.
Insurance against loss of receivables
Good liability insurance in Germany also covers your damage claims if there is no third-party liability insurance and the individual who caused the damage is unable to pay compensation with private assets. In such cases, your insurance company covers the damage.
This clause is particularly critical because private liability insurance is not compulsory, and around 15% of all households in Germany have not taken out such insurance.
Some liability insurers only cover losses from €2,500, if there is no third-party liability insurance or require that you have a legally binding judgment against the person responsible for the damage. For other providers, proof that you have tried to obtain compensation is sufficient.
Insurance for damage caused by courtesy
Your liability insurance should also pay out in the event of damage caused by a courtesy — for example, if you help friends move house and cause damage in the process.
Children before culpability
If you have younger children, your liability insurance in Germany should also cover if they have caused damage. Under German law, children up to their 7th birthday are not responsible for damage. In the case of damage caused in moving traffic, children are not even liable until the age of 10.
New risks should be covered by your private liability insurance for a certain period free of charge — even if a separate liability insurance policy is required for this risk.
What does liability insurance not cover?
Some losses are not covered by private liability insurance in Germany:
- Self-injuries of the policyholder
- Damage caused intentionally
- Damage to items owned by the policyholder
- Fines and penalties
- Damage in connection with criminal offenses
- Damage caused by breach of contractual obligations
- Damage caused by dogs and horses
- Glass damage in your rental property or owner-occupied apartment (glass damage to third-party owned or rental property, on the other hand, is insured under personal liability)
- Any damage covered by motor vehicle liability or professional liability.
How much does liability insurance cost?
The cost of liability insurance in Germany depends on the tariff, the sum insured, the number and, in some cases, the age of the policyholders.
You can get a good single rate from around €5 per month. Family tariffs are slightly pricier but are always the more favorable solution for insuring several people compared to individual policies.
You can take out liability insurance in Germany with or without a deductible. However, due to the low rates, it makes little sense to pay an excess with this insurance.
According to a study by Stiftung Warentest, the cost of liability insurance in Germany varies between less than €70 and over €140 per year, depending on the provider and tariff. Based on the premium amount, no statement can be made about the quality of German liability insurance — in the test, some low-cost tariffs also scored excellently.
Best liability insurance in Germany
You can take out liability insurance in Germany with established insurance companies or digital insurance providers. An insurance comparison will give you an overview of the benefits and costs of the various tariffs in advance.
We present the liability policies from online providers Feather and Getsafe, which are also ideal for expats in Germany. The insurance application and all insurance claims are processed completely online on the providers’ websites. Particularly convenient: all content on the websites is available in English and German. The prerequisite for taking out both tariffs is a German residence.
Feather’s personal liability insurance is available from €4.94 per month. It covers singles, partners, children, and grandparents.
The sum insured is 50 million euros. Feather offers the best performance guarantee for its personal liability insurance.
Getsafe is also a digital insurer with roots in the fintech scene. Its portfolio includes various insurance policies for private consumers: Liability, legal protection, household insurance, private comprehensive health insurance, supplementary dental insurance, dog liability, health insurance for cats and dogs as well as pension insurance (pension, disability insurance, financial provision for children).
Getsafe’s personal liability insurance can be taken out from €2.94 per month and is available in the Comfort and Premium tariffs. Additional drone insurance costs €3.77 per month and covers any number of privately used drones up to a weight of five kilograms. Drones weighing up to 250 grams are insured under the regular liability policy.
The sum insured is 50 million. Insurance is offered for singles, families, and all other people living together in the same household.
The insurance cover is valid worldwide for 5 years and unlimited within Europe; bail payments abroad are covered up to an amount of €250,000 (Comfort) or €500.000 (Premium). In addition to private claims, insurance claims from secondary occupations are also settled.
In its latest test report on German liability insurance, Stiftung Warentest awarded the Getsafe policy an excellent score of 0.9.
How to apply for liability insurance?
It is best to apply for personal liability insurance in Germany directly with the insurance company of your choice. Alternatively, you can use the support and advice of an insurance broker. However, this is not necessary with this type of insurance, as the offers are self-explanatory. The test reports from Stiftung Warentest and other independent advice portals can help you choose your liability insurance in Germany.
Normally, you can take out the policy online. To apply for insurance, fill out the relevant application form on the provider’s website. You will then receive your liability insurance contract by e-mail or by post.
Other types of liability insurance
Professional liability insurance
As a rule, employees do not need professional liability insurance as they are covered by their employer’s company liability insurance. There are exceptions, particularly for civil servants, who should take out employer’s liability insurance.
In contrast, self-employed persons and freelancers should always have professional liability insurance to protect themselves against professional claims for damages. This also applies to part-time self-employment.
For some professional groups — such as doctors, lawyers, or tax consultants — there is a legal obligation to take out professional liability insurance.
Dog liability insurance
Personal liability insurance only covers damage caused by small animals such as cats or birds. Dog owners require separate dog liability insurance. In six German federal states, dog liability insurance is compulsory for all dog owners. It is also often required by law for large or so-called dangerous dogs.
Liability insurance while driving (car insurance)
Motor vehicle liability insurance is a legally required compulsory insurance for all car and motorcycle drivers who use their vehicle on public roads. Motor vehicle liability insurance covers all damage that you cause with your vehicle. The law stipulates the following minimum amounts of cover:
- Personal damages: 7.5 million euros
- Property damages: 1.2 million euros
- Property damages: 50,000 euros
However, most insurance companies offer a higher insured amount.
A deductible is not provided for in motor vehicle liability insurance. However, an excess can be included in a partially or fully comprehensive insurance policy that covers damage to your vehicle to reduce the cost of the insurance.
The no-claims classes influence the cost of car insurance — the higher they are, the lower the premium.
Legal expenses insurance protects you against the financial consequences of legal disputes. You can put together the insurance from various modules to suit your needs. The following legal costs can be insured:
- Private law/contract law
- Tax, administrative and social law, criminal law (as part of private legal protection)
- Labor law/professional law
- Tenancy and real estate law
- Traffic law
Before the insurance pays out for the first time, waiting periods of three to six months apply for many areas of law.
Conclusion – is liability insurance worth it?
Personal liability insurance in Germany is absolutely worthwhile and one of the most important insurance. It provides you with comprehensive cover against claims for damages, which in the worst case could without this insurance cover lead to personal bankruptcy.
A tariff with a maximum sum insured of 50 million euros is ideal.
Frequently asked questions
The law does not stipulate any obligation to take out liability insurance in Germany. However, for motorists is liability insurance mandatory.
You jeopardize the protection provided by your liability insurance if you accept claims from the injured party or pay compensation without the written consent of your insurance company.
You must notify your insurance company immediately of any damage that has occurred.
As a rule, liability insurance policies are subject to notice periods of 3 months. You should submit the notice of termination to your insurer in writing; notices of termination by e-mail are also generally accepted.
The insurance company also has a regular right of termination. Most contracts are concluded for one year and are automatically renewed if neither you nor the insurance company exercise their right of termination. After a claim, the insurer has a special right of termination.
After a claim and in the event of premium increases, you have the right of special termination. The insurer can also assert a special right of termination after a claim.