Which are the most important insurances to have in Germany?

Which are the most important insurances to have in Germany?
Patrick Ott
Patrick Ott
Expert for insurance and finance
28. June 2022

Of course, life is much calmer with many insurances, but not all of them are reasonable. The most important German insurances can be reduced to a few.

Depending on your life situation, you should regularly check whether you require any additional insurance. A distinction must also be made between voluntary and compulsory insurance.

Therefore this article deals with the most important insurances in Germany, which are indispensable here.

Third-Party Liability Insurance (in German: “Private Haftpflichtversicherung“)

Although private liability insurance is one of the voluntary insurances, it is also the most recommended insurance, which can protect you from financial ruin.

If a claim occurs in this category, the amounts are often so enormous that an average citizen usually cannot insure himself. This insurance covers personal injury and property damage to third parties - for example, if you carelessly drop your friend's smartphone in the pool.

As an insured person, you often also have the option of additionally insuring your unmarried children and your partner if necessary.

German Third-Party Liability Insurance

Income Protection Insurance

No one is safe from possible illnesses or accidents. Loss of income can occur at any time – be it due to an accident at work, burnout, or similar causes that prevent you from pursuing your original job.

It is particularly important for people with financially dependent family members or who live entirely off their earned income to protect themselves against existence-threatening risks with occupational disability insurance.

Health Insurance

Compared to the United States, there is an obligation within the German healthcare system to have health insurance.

Everyone is required to have this statutory health and nursing insurance to be able to turn to a doctor in the event of illness without any worries. Otherwise, you will only be treated in an acute emergency.

For civil servants, self-employed workers, and people with higher incomes, it is worth considering switching to private health insurance, as it might be cheaper and can also provide better services than statutory health insurance.

If you are one of those who also travel frequently and therefore have stays abroad, it is advisable to get temporary or long-term international health insurance for these cases. In an emergency, this finances the ambulance transport to Germany.

Pension Planning

Especially at the current time, many doubt the future possibility of a well-paid retirement. The life expectancy of German citizens continues to rise, and the payments into the pension fund that are automatically deducted from wages may not be sufficient in the long term. Concerning the future, it is therefore extremely important to take precautions before you’ve reached the retirement age because otherwise, the pension does not always live up to expectations.

In contrast, it is more advisable to deal with your desired pension and the associated pension gap in advance. This takes into account the time until retirement, inflation, and other aspects that provide information about achieving the desired pension. However, this can also be specifically influenced by a pension plan: Voluntarily increasing the pension insurance ensures that you do not end up penniless in old age.

Average amount of pension in Germany

old German states

new German states


741 Euro

1.065 Euro


1.179 Euro

1.249 Euro

Average amount of pension in Germany, split up in old West German states and new-formed German states as well as women and men. (Source: Aktuelle Daten 2022 - Statistik der Deutschen Rentenversicherung)

Vehicle Liability Insurance

Since a common cause of damage to people and their property is with one's vehicle, liability insurance is mandatory for every vehicle in Germany in order to be able to take part in road traffic at all. Depending on the value of the vehicle, partial or fully comprehensive insurance should also be considered in addition to basic liability insurance.

Germany car insurance

Term life insurance

In life, unexpected things can happen at any time. You might be afraid, that something could happen to you and that your relatives would then be left without any stability in life.

However, you can also secure this case with a clear conscience. In the event of death (usually up to a maximum age), term life insurance pays the sum insured and ensures that the persons named in the insurance policy receive this sum.

Supplementary care insurance

In addition to the statutory nursing insurance, which covers the basic necessities, supplementary long-term care insurance is also recommended if the benefits of the nursing insurance are to be increased. Should you ever need extended care service, this will be great financial support. This insurance mostly makes sense from the age of 50. Of course, the premiums are cheaper the younger and healthier you are when you start the insurance.

Supplementary care insurance in Germany

Building insurance

Anyone who owns a property is extremely afraid of losing it. Consequently, it is also crucial to protect this property against possible dangers. Common damage such as fire, water, but also elemental damage destroys your home immediately.

In order to not become homeless in such circumstances, the building insurance secures the property for the owner. Usually, when buying a house, the existing building insurance of the previous homeowner is taken over.

When it comes to building insurance, it is also essential to ensure that gross negligence (“Grobe Fahrlässigkeit”) is covered, as damage to a home is often self-inflicted.

Household contents insurance

While the building insurance covers the property itself and the fixed inventory such as heating systems, household contents insurance takes care of the furnishings. Their value can increase enormously in an apartment or house. If you then face some damage to your interior, the household insurance covers the entire content. Clothing, furniture, and any equipment are then fully protected against the usual damage such as fire, tap water, and burglary.

Household insurance in Germany

What do I do now?

This is a question you have to keep asking yourself when it comes to insurance.

  1. First, make sure that you own the legally required insurance.
  2. Then obtain important insurances such as disability insurance and liability insurance, as your existence might otherwise be threatened.
  3. Check your current insurance policies for coverage and compare terms with other insurance policies to get better value for money.
  4. Take a look at your current circumstances: Do you have children or pets? Are you a tenant or a homeowner? Employee or freelancer? Depending on this, you should reconsider whether you may need more insurance.

Once you have gone through these steps, you can rest easy knowing that you have the best possible protection without taking out unnecessary insurance.

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