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Car insurance in Germany

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First things first

According to the Federal Statistical Office, a traffic accident occurs every 13 seconds in Germany, in which an entire life can be ruined if the individual is unprepared.

Through the right combination of the six different insurances, unnecessary costs can be avoided, and the highest security can be achieved.

A wide range of data about the driver and the vehicle is used to calculate the rates, with premiums increasing for higher risks - but they can be customized as well.

There are voluntary and mandatory insurances; no driver's license will be issued without the compulsory insurance.

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Car insurance in Germany

Patrick Ott
Patrick Oliver Ott
Expert for insurance and finance
28. June 2022
insurance for vehicles

Which types of car insurance are in Germany?

You must familiarize with all types of car insurance available in Germany, not doing so, may cost you a lot, later. Furthermore, without third-party car insurance, one would not even get a driving license. 

However, there are also relatively useless car insurance policies, which usually only cost money unnecessarily and do not provide any additional protection because other insurance policies already cover the damage cases. Read on now to learn all the essential things you need to know about different car insurance policies in Germany to save on unnecessary costs and be well insured.

Car Liability insurance in Germany (Kfz-Haftpflichtversicherung)

Car liability insurance in Germany
The car liability insurance is the only compulsory auto insurance, and it is required to obtain a driving license. However, it is tax-deductible (if you use your private car as a company car) so that costs can be saved. It covers the damage claims of third parties, which arise in the event of damage by the own motor vehicle. Therefore, it is liable both in the event of a self-inflicted traffic accident and in the event of accidents for which the driver is not at fault.

A claim can also be made if the damage is caused without fault. This is possible, for example, in the case of an accident caused by contamination of the roadway by another vehicle.

What is a typical German car insurance usually covering?

  • Personal injury coverage for oneself and others
  • Disability pensions
  • Coverage of property damage
  • Coverage of property damage
  • Registration and deregistration costs
  • Lawyer and court costs
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Costs of a car insurance in Germany

The cost depends on various factors related to the vehicle and the driver. These include the no-claims class, which is determined by the number of claim-free years of driving. In addition, the benefits and conditions of the respective automobile liability insurance are also decisive factors. However, the average cost is €250 per year.

When choosing the right automobile liability insurance, the coverage amount should be taken into account. This indicates the maximum amount that is covered by the insurance. Germany has a minimum coverage of €7.5 million for personal injury, €1.12 million for property damage, and €50,000 for financial loss. 

Nevertheless, these can be reached quickly in the event of a claim. Therefore insurance consultants recommend choosing a sum insured of €100 million to be on the safe side.

Another factor for cost reduction is the amount of the deductible. Although it can be used to reduce monthly costs, it does not cover small claims. Nevertheless, this is sufficient to protect against the most significant risks at a reasonable price.

The Comprehensive or Hull insurance (Kaskoversicherung)

Comprehensive insurance is voluntary and taken out in conjunction with statutory motor vehicle liability insurance. It is intended to cover additional risks, such as damage, destruction, and loss of the own vehicle. Depending on the scope of insurance, it is divided into partial and fully comprehensive insurance.

Comprehensive insurance usually protects against damage such as short circuits, glass breakage, or defects caused by animals or forces of nature.

In addition, it is also liable for robbery, theft, and embezzlement of a friend. Should explosion damage occur, comprehensive insurance will also cover it.

In the case of comprehensive insurance, there can be drastic reductions in benefits in the event of gross negligence, especially in the case of low-cost contracts. Furthermore, it should also protect against all types of animals, according to the BdV. Otherwise, only damage involving wild animals is covered.

When selecting a comprehensive insurance policy, attention should also be paid to a workshop commitment. This feature can usually save 20 %, but it also results in the loss of the new car warranty in case of damage.

Comprehensive insurance in Germany

Partial Cover Car insurance (Teilkaskoversicherung)

Partial cover insurance protects against external influences regarding the own car. It is the cheaper version of the fully comprehensive insurance and therefore more interesting for older used cars from 5 to 7 years. If the vehicle's value has already dropped considerably, partial cover insurance may no longer be worthwhile.

However, with partial comprehensive insurance, only damages caused by wild animals are covered, while those caused by martens and farm animals are not included. In addition, there is also a risk in case of hit and run, which is only covered by fully comprehensive insurance.

In the case of partial comprehensive insurance, depending on the term of the contract, there is the possibility of covering claims or canceling the insurance cover at any time. In most cases, the partial cover insurance is linked to the motor vehicle liability insurance.

What does the Partial Cover insurance cover?

  • Repair costs for own and third-party vehicles
  • Disability pension
  • Personal injuries

Costs of the Partial Cover insurance in Germany

The costs depend on several factors. For example, the insurance premium is determined by the vehicle type or type class, the regional class, and the postal code. In addition, there are the annual mileage and the age of the vehicle at the time of the takeover, as well as the driver's age. 

It is also relevant whether there has been a claim within the last 24 months. If the premiums are too high, they can be reduced by a higher deductible. The cheapest partial cover insurance can currently be purchased for €2.76 per month.

Fully Comprehensive insurance in Germany (Vollkaskoversicherung)

Like partial cover insurance, the fully comprehensive insurance is not a compulsory insurance. It extends the partial casco and provides coverage for additional damage. This includes vandalism but also self-inflicted or third-party fault on one's vehicle.
For example, it also covers damage caused by children who are not liable. In this case, the claims of the partial cover insurance no longer lead to a burden on the no-claims bonus of the comprehensive insurance.

It is especially interesting for new cars, electric cars, hybrid models, and luxury cars with a high new purchase price. With the right insurance, the new value compensation can be extended from 6 to 24 months. Furthermore, unlike partial coverage, it also offers a fee reduction with each claim-free year.

Also, in the case of a leasing contract or financed vehicle, fully comprehensive insurance should be concluded to be on the safe side.

Fully Comprehensive insurance in Germany

What does a German Fully Comprehensive car insurance cover?

  • Repair costs for own and third-party vehicles
  • Disability pension
  • Personal injuries

Costs of a Fully Comprehensive insurance

For fully comprehensive insurance, the same factors as for partial comprehensive insurance are used to calculate the costs. Beyond that, the no-claims bonus also plays a role in the calculation. The cheapest rates can currently be obtained from €3.39 per month.

The Letter of Protection (Schutzbrief) and the Automobile Clubs in Germany

A letter of protection or an automobile is additional coverage options with similar benefits in the event of an accident. In this case, the insured person receives assistance from the insurer in various situations such as an accident, breakdown, or theft.

Most providers have a similar range of services, but they differ in detail. The essential services include breakdown assistance with restoration of the vehicle's readiness to drive at the scene of the accident and recovery and towing of the vehicle.

When choosing a protection letter or automobile club, attention should be paid in any case to the coverage of the service locations. Otherwise, the claim will not be covered by the service.

However, an automobile club and a letter of protection also have differences. For example, unlike a letter of protection, a traffic club protects not only one vehicle but also those of other family members. Moreover, they also differ in the legal protection, which is included in the traffic club.

Another advantage is that a traffic club membership can be purchased flexibly, while a Schutzbrief can only be acquired with a car insurance policy. Furthermore, a Schutzbrief only offers capped cost coverage of 100 to 200 euros, which is much higher for automobile clubs.

However, a new car does not necessarily require roadside assistance from a letter of protection or automobile club. In such cases, the mobility guarantee of the car manufacturer is liable in many cases of breakdown.

What do a German Automobile Club and Schutzbrief cover?

  • Roadside assistance
  • Rental car
  • Overnight stay
  • Onward and return journey
  • Substitute driver
  • Medical return transport
  • Mostly complete recovery costs
  • Towing service
  • Vehicle immobilization
  • Spare parts
  • Burial costs abroad

Costs for a Protection Letter or Automobile Club in Germany

A Schutzbrief in Germany costs on average 14 € per year, but there are also considerable deviations upwards and downwards. The fees are determined depending on the vehicle model and the desired tariff.

The cost of an automobile club is more expensive than that of a Schutzbrief. Its fees range from 27 to 85 € per year, but it also offers better service and higher reimbursement amounts.

Passenger Accident insurance (Insassenunfallversicherung)

According to Stiftung Warentest and the consumer protection organization Bund der Versicherten, passenger accident insurance is pointless because the damages are already covered by other insurances such as motor vehicle liability, health, accident, and occupational disability insurance.

For example, the hospitalization of the person who caused the accident would not be covered by motor vehicle liability insurance. In this case, the passenger accident insurance would then be liable, although the health insurance of the person responsible would also cover this damage.

However, passenger accident insurance can make sense in some situations. This is the case, for example, with an unavoidable event such as an accident caused by an animal. Another example is an accident abroad, which is only covered with a low compensation through liability insurance. In addition, passenger accident insurance can also protect in the case of an accident perpetrator without liability insurance and sufficient assets to pay the claim.

What covers the Passenger Accident insurance?

  • Damage to persons inside the vehicle
  • Continued payment of wages
  • Costs for household help
  • Compensation for pain and suffering
  • Maintenance payments for surviving dependents

Costs of a German Passenger Accident insurance

The cost of passenger accident insurance is determined by the insurance model selected. This means that there is an option to choose between an individual or a fixed sum insured to cover the costs of a claim. In the case of a fixed model, the sum insured is divided among all passengers in the event of a claim, while in the case of the flexible variant, this increases with each vehicle occupant.

Compared to classic accident insurance, the costs of this variant are significantly lower due to the damage limitation. The basis for the calculation can be a flat rate or a calculation according to the number of seats and the number of persons. The fees amount to 50 to 120 € per year. However, in most cases, general accident insurance is more worthwhile despite the difference.

Traffic Legal Protection insurance 

If someone travels a lot by car, a situation can quickly arise in which the guilty party is unclear. In such cases, traffic legal protection insurance can provide security. It covers almost all cases of road traffic. One exception is deliberate self-infliction, as in the case of an accident under the influence of drugs.

It is primarily liable for one's damages with possible compensation for pain and suffering. Furthermore, with legal protection insurance, the high costs or even the advance of the court costs until the judgment can be saved.

Traffic incidents are often already covered by the general legal protection insurance or can be added as additional benefits. Combination insurance usually makes sense if other areas of life are also affected by increased risks.

What does the Traffic Legal Protection insurance cover?

  • Costs for own and opposing counsel
  • Court costs
  • Costs for appraisers and experts
  • Expenses for witnesses
  • Costs for mediation in case of an out-of-court settlement

Costs of the Traffic Legal Protection insurance

A car's legal protection insurance fees depend on the chosen insurance model. For these, the costs for the aforementioned damages are covered up to the respective coverage amount from the amount of the deductible. However, the costs for the deductible may be waived if no claim has occurred over a more extended period. Furthermore, the price depends on the choice of combined or isolated liability insurance. The costs range between 61 and 163 € per year for pure traffic legal protection.

When selecting a motor legal protection insurance, at least a coverage amount of € 300,000 per dispute should be covered. A higher deductible can reduce the costs, but in this case, motor legal protection insurance is no longer worthwhile for minor legal disputes. Nevertheless, they protect against the most expensive damages, incredibly cheap.

Fully comprehensive insurance

Glass breakage

Theft

Wildlife accident

Scratches in the paint

Dents

Explosion damage

Grafitti

Separated mirrors

Repair costs for own and third-party vehicles

Disability pension

Personal injuries

Partial cover insurance

Glass breakage

Theft

Wildlife accident

Explosion damage

Repair costs for own and third-party vehicles

Disability pension

Personal injuries

Letter of protection / automobile club

Roadside assistance

Rental car

Overnight stay

Onward and return journey

Substitute driver

Medical return transport

Mostly complete recovery costs

Towing service

Vehicle immobilization

Spare parts

Burial costs abroad

Passenger accident insurance

Damage to persons inside the vehicle

Continued payment of wages

Costs for household help

Compensation for pain and suffering

Maintenance payments for surviving dependents

Traffic legal protection insurance

Costs for own and opposing counsel

Court costs

Costs for appraisers and experts

Expenses for witnesses

Costs for mediation in case of an out-of-court settlement

Final words on car insurances in Germany

Of all the types of car insurance, only motor liability insurance is compulsory. It is supposed to protect from self-inflicted damage in road traffic. Voluntary partial and fully comprehensive insurance, on the other hand, protects against damage caused to one's vehicle. In this context, partial comprehensive insurance is particularly suitable for newer used cars and fully comprehensive for expensive new cars.

A traffic legal protection insurance protects against virtually all legal matters that go beyond the damage liability of motor vehicle liability insurance. The only insurance that is not as important is passenger accident insurance because other types of car insurance already cover damage claims. However, it can also be helpful in the case of unavoidable events abroad.

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