Do you know you can get bankrupt and be in a lifetime of debt if you have a bad accident? This can happen, unfortunately. BUT, you can prevent this by getting liability insurance in Germany. Liability insurance is a Must-Have in Germany. The best thing is that it is really cheap and affordable. In this article, you can find all you need to know about liability insurance in Germany, and a comparison of the best liability insurance offers.
Moving to Germany or new in Germany? Check out our Resources Page for all the help you need!
Some highlights for the busy people
If you don’t have much time, here are the highlights of the 5 best liability insurance in Germany:
Lemonade: English support, easy sign-up process, and fast claims. Support a charity of your choice.
Adam Riese: Backed by the big W&W Group in Germany. 100% online with no paperwork. Support of social projects.
GEV: A long-established insurance company in Germany with more than 120 years of tradition. Very cheap price.
Helden: Comprehensive coverage with a flat rate policy. Sign up in 3 minutes. No paperwork. Free changing services and cover your self-employed side job.
Keep on reading for more details about liability insurance in Germany and scroll down for a detailed comparison table.
What is liability insurance?
Liability insurance (Haftpflichtversicherung) is not mandatory in Germany. However, it is one of the most important types of insurance in Germany. If you don’t have liability insurance yet, get one now! When shit happens, you will feel thankful. The best part is that the price of liability insurance is relatively cheap. With a few Euros per month, you can have peace of mind. Actually, the vast majority of German people have liability insurance. Without one, it may be even more difficult for you to find a flat to rent in Germany. Many landlords in Germany require their tenants to have liability insurance.
Liability insurance covers you if you cause any damages to third parties. Third parties are people who are not insured in your liability contract. The damages can be material or physical (injuries). In Germany, there is no upper limit of what you have to pay due to the damage you cause, even though if you do not intend to cause the damage. Without liability insurance, you can easily go bankrupt if an accident happens. And you may need to pay compensation to the damaged parties for the rest of your life. Sounds scary, right?
Unfortunately, I am not scaring you. Below are examples of some unlucky events.
How can liability insurance save you?
Below are some examples:
- You hit a person by accident when you are biking/ running. You will be responsible for the medical costs for this person and his potential loss of income if he cannot go to work due to the injury.
- Similarly, you hit someone badly when you are playing soccer or skiing. The person needs surgery and will suffer long-term. Your liability insurance can save you in this case.
- You accidentally drop your friend’s smartphone when you are helping her to take a picture.
- You accidentally spill your coffee over someone’s laptop, e.g. in a café or at a friend’s place.
- You hit someone’s car and cause this person to miss his flight. Your liability insurance can pay for the flight ticket and the potential accommodation costs.
- You give someone a USB without knowing that it contains a virus. The computer of this person is not functioning anymore and you are responsible for the damage.
- You knock over a vase at your friend’s home or in a shop.
- You cross the street on a red traffic light to catch your bus. An oncoming car needs to brake all of a sudden and this causes a rear-end collision involving several cars. Several cars are damaged and drivers are injured. In this case, you are responsible.
- Your washing machine leaks and floods your rental apartment. All the wooden floor needs to be replaced.
- If you lose your apartment key, the locks for your whole building may need to be replaced. This can easily cause thousands!
Can that really happen to me?
Do you think that these examples are theoretical and they will not happen to you? Let me tell you some personal experiences:
- My friend was cooking in his rental apartment and accidentally dropped his pan into the kitchen sink. The sink was broken. He called his liability insurance and just got a reimbursement without problems.
- This one happened to us: We accidentally knocked down our diffuser at home when we were cleaning our furniture. The essential oil was spilled onto our wooden floor. We were renting our flat at that time. We tried different methods to save the wooden floor but still, we could see the oil stain there. It ended up more expensive than we thought because it was not possible to only replace that part of the floor. Our landlord had to replace the wooden floor from the whole room. It would have cost us some thousands if we didn’t have liability insurance. We do not put any diffuser at home anymore since then.
When shit happens, there is a huge difference to your fate if you have liability insurance. Take a look at this example on Reddit when someone has no liability insurance.
Another Reddit example – happened to someone with liability insurance. A totally different outcome.
Liability insurance in Germany – What is covered?
Liability insurance in Germany covers the damages you cause to other objects, people, and their financial losses. Many insurance companies offer policies that cover your whole family, including your spouse and your children. Some even cover guests who stay at your place.
Depending on the policy, it may also cover the following aspects:
- Bad debt – In case someone causes damage to you and is not able to pay (e.g. if he has no liability insurance), your insurance will pay you instead.
- Damage caused by your small pets – Pets like dogs or horses will usually need separate liability insurance.
- Loss of your keys – For example, the replacement cost of locks in your building.
- Passive legal protection – If someone wrongly accused you, your liability insurance will pay the legal costs for your defense.
- Depending on your policy, your liability insurance may cover you abroad for a certain period.
- Some insurance company offers a “Best Performance Guarantee“. It means that even if your insurance policy does not cover the specific damage you have caused, you will still receive insurance cover if you can prove that another insurance company will cover this kind of damage. This guarantee ensures that you always get the best coverage available and save you time from comparing all the different policies on the market.
Simple vs. gross negligence
There is a difference between damages caused by simple negligence and gross negligence. Simple negligence is covered in every liability insurance. An example of gross negligence can be that you drive through a red traffic light and cause an accident. Gross negligence is usually not covered by liability insurance. But you may find certain insurance policies that have it covered.
Small children are incapable of guilt
In Germany, children younger than 7 years old are considered to be incapable of guilt. So, if your little kid causes a dent in your neighbor’s car, then your neighbor has bad luck. You may still want to compensate your neighbor to maintain peace (but that is another story). Some liability insurance policy does cover damages caused by small kids with a higher premium. Note that for road traffic, children up to 10 years old cannot be held liable in Germany.
Liability insurance in Germany – What is not covered?
In general, most liability insurance in Germany do not cover the below damages:
- Since small children under 7 years old are not legally liable, many liability insurance policies will not cover damages caused by them.
- Damages that are done intentionally
- For damages caused by driving, you will need separate car insurance. Read more here with 13 ways to save money on your car insurance.
- Penalties and fines are not covered by liability insurance.
- Liability insurance does not cover the cost if you want to sue someone. You will need law protection insurance in this case. Get a 15 EUR discount using this link!
- Damages from criminal offenses
- Damages to your own things are not covered by liability insurance. You will need home insurance if you want to insure your own furniture at home.
- Damage caused by risky sports or hobbies like hunting.
- If family members hurt each other accidentally, it will be covered under accident insurance instead of liability insurance
- For damages caused by dogs and horses, you will need separate insurance. Check out also this post about pets in Germany.
- Damages due to breach of contracts.
- Damages because of your work or business activities are not covered by many liability insurance policies.
How much does liability insurance cost?
The cost of liability insurance in Germany depends on a lot on the following factors:
- The extent of coverage
- The insurance provider
- The amount of deductible you choose
- If you are single or married
- If you have children
In general, liability insurance is relatively cheap. It costs only 3 to 6 Euros on average per month. If you are single, it can cost around 30 to 50 Euros per year. And the price for whole family coverage is around 45 to 65 per year. With less than 100 Euros in a year, you can get very good coverage. Considering the importance of having liability insurance in Germany and the coverage of millions of Euros, the insurance price is really cheap.
The 5 best liability insurance in Germany
You can see below a comparison of different liability insurance offers. I recommend the below offers as they have at least 10 million Euros total coverage and you can cancel the policy any time. All of them include coverage outside Germany. You can also use Tarifcheck to compare different offers if you want.
The prices stated in the table can be higher if you purchase different add-on based on your individual needs. The price may also be different depending on your address and if you had any claims in the past. “Optional” means that you can purchase this extra add-on.
Note: The below table can be moved sideways depending on your screen.
|Monthly price starting from||3.59||2.00||1.89||1.98||6.00|
|Max coverage in Euro||50 million||10 million||50 million||50 million||50 million|
|Deductible in Euro||0||0||0||0||150|
|EU coverage||Unlimited||3 Years||Unlimited||3 Years||Unlimited|
|Worldwide coverage||5 Year||1 Year||5 Year||1 Year||5 Year|
|Rental property damage||✔||✔||✔||✔||✔|
|Coverage for drone||Optional||NA||Optional||✔||✔|
|Bad debt recover||✔||NA||✔||✔||✔|
|Damage caused by unliable people, e.g. small kids||Optional||NA||✔||Optional||✔|
|More Info||More Info||More Info||More Info||More Info|
Getsafe was founded in 2015. It started originally as an insurance broker and changed to building its own digital insurance products.
You can sign up in a few minutes and manage everything in one app without the paper trail.
Lemonade was founded in 2015 and it is based in New York. The great thing about Lemonade is the easy sign-up process and fast claims. Everything can be handled through their app and no paperwork is needed. Besides, Lemonade donate your unclaimed premiums to a charity based on your choice.
Adam Riese is a German company founded in 2017. It is backed by a big and established financial service company called W&W Group in Germany. The goal of Adam Riese is to make insurance simple, digital, and fitting for its customers.
Some highlight below:
- 100% online with no paperwork
- Update guarantee (Any future change in conditions that are favorable to customers will apply to your current contract)
- Support social projects
With a slightly higher price (less than 0.2 Euro more per month), you can also get additional coverage below:
- 50 million Euros total coverage
- Drone coverage
- Best performance guarantee
Grundeigentümer-Versicherung VVaG (GEV) is a German company based in Hamburg. It was founded in 1891 and has more than 120 years of tradition.
The price includes an update guarantee. So, any future change in conditions that are favorable to customers will also apply to your current contract.
Helden was founded in 2016 and is based in Hamburg. It offers very comprehensive coverage with a flat rate policy. Even though the website is only in German, their customer support can speak English. Here are some highlight below:
- 3 minutes sign-up
- 100% digital with no paperwork
- Best performance guarantee
- Free changing service if you have a liability insurance policy already
- Your self-employed side job is covered if you have up to 20,000 Euros annual revenue or 6,000 Euros annual profit
Which liability insurance should you choose?
A high sum of coverage
As mentioned before, the price of liability insurance is relatively cheap. We are talking about an insurance premium of a few Euros a month! So, it makes sense to set the coverage amount as high as possible.
Imagine if you hurt someone accidentally, the medical cost and loss of income will be huge damage. To protect your private assets, you should choose a liability insurance policy that has at least 10 million Euros coverage for each injured person.
Duration of contract
A lot of traditional German liability insurances have a contract term of one year or more. Some even lock you in for three to five years. You are not allowed to cancel your contract before the term ends. I wouldn’t recommend getting a liability policy that locks you in such a long period. Your policy should be flexible. It would be stupid if you find a better offer in the market but are unable to change due to the contract term.
Another tip is that sometimes, your insurance premium is lower if you choose to pay yearly instead of monthly. So, you can save some money by opting for a yearly payment.
Choose your deductible
The deductible amount is what you have to pay out of pocket before you can claim from your liability insurance. The higher the deductible amount, the lower your insurance premium. You should choose the right deductible amount based on your financial situation. Usually, your deductible shouldn’t be higher than 500 Euros.
Bear in mind that your liability insurance company has a special right to terminate your contract after an insured event. If you go for another liability insurance company, the number of your past claimed cases may also drive up your premium price. So, that’s why you may not want to report damages if they are very minor.
Bad debt protection
Imagine that someone damages your property. You win the case. He is liable and has to pay you compensation. And here is the interesting part. He is broke and has no money to pay! And he has no liability insurance!
What should you do now? Suck it up and repair the damage out of your own pocket. So unfair but that is what could happen in life.
But you can actually prevent this. Choose a liability insurance policy with bad debt coverage. Make sure to read the fine print of how the insurance company defines bad debt. Some insurance companies are stricter and require you to take legal action against the damaging party first, while some other companies may not require this.
Best performance guarantee
As mentioned before, some insurance company offers a “Best Performance Guarantee”. With that, you don’t have to constantly compare your insurance policy to the others in the market. And you can always be sure that you get the best coverage with your price. Besides, an insurance policy with a “Best Performance Guarantee” usually doesn’t cost much more than the others.
Adding special coverage as needed
The goal to have liability insurance is not to go for the cheapest one. But it is to make sure that you are protected in every aspect of your life. Depending on your personal situation, you may want to pay a bit extra and add some special coverage (e.g. drones or E-Bikes). If you live in a rental apartment, you may want to add coverage for the loss of keys.
Another example: if you have small children, make sure to add the special coverage called “Deliktunfähige Kinder”. This is because small children under 7 years old are incapable of guilt. Even though you will not be legally liable if your kids damage your neighbors’ property, you may still want to compensate your neighbors to maintain peace and be responsible.
A financial adviser can help you
If you prefer to get professional advice before buying your insurances, I can highly recommend our financial adviser to you. We bought all our insurances from him and he explained everything thoroughly to us. He does not work for a specific insurance company, so you can be sure that he can give you independent advice. Besides, he speaks excellent English, which is perfect for expats like me. Just write or call him and mention my blog “My Life In Germany” to get a free consultation.
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Please be aware that this article is for information only. We are not an insurance broker platform and this article does not represent professional advice. Before purchasing, you should read the fine print of the insurance policy to make sure you understand the details. We will try to keep the insurance offers in this article updated regularly. In case you see any outdated information, please let us know and we will update it accordingly. Our blog accepts no liability in any case. If you need any more details or the latest information, please refer to the insurance companies’ websites directly.
Do you have liability insurance in Germany? Have you ever caused any damage and made any claims? Leave a comment below and share your experience!
Moving to Germany or new in Germany? Check out our Resources Page for all the help you need!