Private Third Party/Personal Liability Insurance
one of the most important insurances to have during your time in Germany.
Private personal liability insurance (Private Haftpflichtversicherung) is one of the most important insurances to have during your time in Germany. It offers cover for the financial implications arising, should you or your family cause unintentional damage to a third party, either physical, material or financial.
In Germany there is no general limit to how high a claim can be, meaning any caused damage can threaten your financial future. It is not expensive and a good tariff offering maximum coverage for a single person costs well under 100€ per year.
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Video 7.46 min
What does private personal liability insurance insure and why is it important in Germany?
In is in the nature of accidents, that they happen fast and without warning. For instance your child is playing football in the garden and accidentally kicks the ball through the neighbor's window. Or you yourself might dash across the road to catch a bus, not noticing that the lights are red. A car has to brake resulting in a rear-end collision.
In such cases, you are liable for the damage incurred - up to the limit of what can be seized from you. Since no one can foresee accidents, it is common sense for everyone to have a personal liability insurance that covers the costs incurred. However, according to the German insurance association GDV only 85 percent of all households in Germany have such a policy.
Personal liability insurance covers personal, property and financial damage.
99 percent of all property damage cases - like a broken window - cost less than 5,000 euros. However, it can get really expensive if people get hurt.
A cyclist has an accident as a result of your actions and has to be treated in hospital and undergo several weeks of rehabilitation in a clinic. Then you are not only liable for compensation for the treatment and damages for pain and suffering,, but also for the loss of earnings of the cyclist. If someone dies, the survivor's claims can amount to millions.
A financial loss can arise if you act negligently resulting in financial loss or diminished profit for a person or a company.
The private personal liability does not pay for:
How can I find a very good personal liability insurance?
(Private Haftpflicht Versicherung)
Personal liability insurance costs between 50 and 100 euros per year. The price differences between the different tariffs are not really significant and influenced by the benefits they offer. There can, however, be large and significant differences in the benefits.
These differences range from the amounts that the insurance covers in the event of damage (insured sums), through the insured areas of life, up to dealing with the question of whether you will receive monetary recompense if someone inflicts harm on you but can not pay you (claim payment default).
To repeat, it is more important that your cover is as good as can be, than to focus solely on getting the cheapest policy.
Our insurance advisors are qualified and licensed experts in this area and at dealing with ex-patriates. Their advice will be at no extra expense to yourself as they are reimbursed direct by the insurance companies
Annual contributions of outstanding tariffs in euros
(comparison of well-known suppliers)
What should you look for in your liability insurance?
There are only a few, but despite that, important points, in which the tariffs we recommend differ from the many good tariffs to be found in the market.
The sum covered must be sufficiently great.
The principle rule for private personal liability insurance is to set the insured sum as high as possible. A higher cover costs very little extra and is of particular benefit in the case of personal injury. Since legally there is no upper limit to the amount for which you may be made resposible, the amount covered in your policy should be set as high as possible, since in the worst case scenario any shortfall you will have to pay from your own pocket.
With cover of €50,000,000 you are securely insured, and you should ensure that in addition each individual qualifying for a damages claim is covered for at least €10 million. This is the case with all recommendations we provide.
Best-of-class guarantee completes your protection.
With a Best-of-class guarantee the insurer promises the client, that in the event of a claim to behave in the same manner as the best of the insurers in the German market. This comes into play when otherwise your insurance company would take the stance that this is an area of life that is not covered, or that the damages limit is insufficient to cover the claim.
If you are able to show that in such a case another insurer would have paid, then the conditions of that insurer apply to your policy also. Effectively, the Best-of-class guarantee raises the cover to the highest level achievable in Germany.
Basically, a Best-of-class guarantee included in a tariff is better than one which lists all imaginable risks covered, but doesn´t offer such a guarantee, or places limits on it. The polcies from the three insurances companies we use to make reccomendations all include Best-of-class guarantee. In the policy documents this may be referred to in other terms, such as “Erwieterte Vorsorge” (extended protection).
The Best-of-class guarantee though, still has its limitations. It fills the gaps covered by other insurers in relation to personal liability. For children who cannot be held responsible in law and for family members suffering from dementia, for whom you cannot be legally be made to pay (and thus relieving the insureralso), the Best-of-class guarantee is of no help. To guard against such cases your policy must include a “No exclusion in event of no legal liability” clause.
If you want to replace your neighbour's window that was smashed by your five-year-old child with a ball, the question arises whether you have violated your duty of supervision. If this is not the case, you generally do not have to pay for the damage. If you want to settle the damage anyway, you must either do this out of pocket or make sure that your private liability includes this clause on legal liability.
Claim payment default cover is a must.
As important as the sum insured itself is the cover in the event of claim payment default. This works like a personal liability insurance in reverse. If you suffer damages and the person responsible cannot pay you your due damages, then your insurer assumes responsibility for the sum. Many insurers,however only offer this for damages above €2,500.
Some insurers require that you have been awarded damages legally against the other party, whilst for others it is sufficient that you can demonstrate you have taken all the necessary steps to obtain the money. Depending on the amount of damages, the effort involved can be well worth it if it means you are recompensed for the damages you have suffered.
Families only need one policy.
If you are married or living with a permanent partner, one policy per household suffices. Children are always covered by the policy of their parent(s) until the end of their first year in occupational training.
Unmarried couples who take out a family policy should, however, be aware that damage claims between members of the household covered by the policy are often excluded.
This can be a problem especially in respect of personal injury, for example if one partner accidentally knocks down and injures the other. In such a case the health insurance of the injured party will claim the resulting treatment costs from the party resposible for the accident - and that can involve very large sums for serious injuries.
It is important to ensure that your insurance explicitly covers recourse claims from providers of social security services and reciprocal claims between those persons covered by the policy.
Decide on an Excess
With a deductible excess you can reduce the premium. It makes sense to set this at about 150 euros a year. Without a deductible excess, you can of course claim minor damage through the insurance. However, it can happen that the insurer will then terminate the policy as soon as the damage has been settled since following a settled insurance claim, he has a special right of termination.
Please note: With particular insurers a deductible excess will be imposed on you if you have reported two or more damages to the previous insurer. If this applies in your case, your adviser will make you aware of this.
Other important clauses
Even the best contracts do not cover every possible form of damages. Also, not all clauses are equally important to every customer.
We consider the following two clauses to be very important to consider:
Children are insured in the private personal liability until they have completed their education or studies. Until the age of seven, they have no legal responsibility. Parents therefore are not legally liable for damages incurred by them. But in many cases people want to reimburse the damage in order to maintain harmony in the neighborhood or circle of friends.
In order that the insurer to pays in these circumstances, you need the “No exclusion in event of no legal liability” clause. Be sure it is in the policy if you have children. Without it even the Best-of-class guarantee will not help here, as this goes beyond the purely legal requirements.
Loss of Keys
This clause is not a must in every case, but it could save a lot of money if you ever lose the key to your rented home or office since often then the locks for the entire system in the house or offices must be replaced. The cover for loss of keys will pay the costs arising in such a case. If you live in a multiple dwelling with many neighbors, we strongly recommend this clause.
Many access systems to office buildings are anonymous, in that often one cannot identify from the key or the card to which complex it belongs. In these cases you do not need such a clause for business keys. But as soon as direct relationship between key and office building is possible, the clause is recommended. This is especially true for teachers, for example, because in schools, virtually every key is a master key.