Liability insurance is considered by many Germans to be the most helpful and crucial of the optional types of insurance. Private liability insurance covers the expense of damages up to a certain amount in the case of a claim. It also protects your family, including your spouse and children.
It happened quickly: your child is playing soccer in the garden and accidentally kicks the leather into the neighbor’s window. Or you run across the street when it is red to catch the bus. A car has to brake and causes a rear-end collision.
You have to pay for the damage caused. In the worst case, it can ruin you – unless your personal liability insurance takes care of it. We’ll show you how to find a good one and why it can be worthwhile to change your contract every now and then.
What does private liability insurance cover?
Since no one can foresee accidents, everyone should have personal liability insurance. It covers the costs if you accidentally break something or injure someone, thus protecting you from financial damage. Nevertheless, according to the Federal Statistical Office, in 2018 only just under 83 percent of all households in Germany had such a contract.
A private liability insurance insures personal injury, property damage and financial loss. Much of the property damage – such as a broken window – costs a maximum of a few thousand euros. On the other hand, it can get really expensive when people are injured.
An example: A cyclist falls because of you. She has to go to the hospital and then to rehab for several weeks. Then you not only pay compensation for pain and suffering and the treatment, but also the cyclist’s loss of earnings – i.e. the financial loss that she incurs because she cannot work.
If the cyclist dies through your fault, the demands of the bereaved can run into the millions. You are liable for the damage incurred – up to your personal attachment limit.
Private liability does not pay for:
- Injuries to your own body that you (accidentally) inflicted on yourself,
- Willfully caused damage,
- Damage from criminal offenses,
- Fines and damages due to the breach of contractual obligations,
- Damage that is covered by the motor vehicle liability insurance,
- Damage from dogs.
Which private liability tariffs are recommended?
You can get very good personal liability insurance for as little as 50 euros per year. The absolute price differences between the various tariffs are manageable. In contrast, there are major differences in performance.
They range from the amounts for which the insurance pays in the event of a claim (sum insured), to the insured areas of life, to dealing with the question of whether you will get money if someone causes you damage but cannot pay it (bad debt loss). So it makes sense to compare private liability insurance rates.
In November 2020 we examined very good tariffs for private liability insurances and consider four tariffs to be particularly recommendable. In our comparison, the “Simply Better Plus” tariff from liability insurance offered very good benefits for everyone for little money. You pay 61 euros a year (55 euros with digital contract management) if you choose 125 euros deductible.
Single people may get away with the tariffs “Liability Online L” from Axa and “Klassik-Garant Exklusiv” from VHV even cheaper than with liability insurance. The Axa tariff costs less than 50 euros a year for singles with a deductible of 150 euros, but this depends on where you live. At VHV you pay from 53 euros per year, depending on where you live.
For everyone aged 55 and over, the Bavarian “Prestige” tariff is slightly cheaper than for everyone else.
For details on our personal liability comparison, see How We Tested, below.
What should you look out for in personal liability insurance?
There are only a few, but important points in which the private liability tariffs we recommend differ from the many good tariffs on the market. Here are the most important points to look out for when comparing personal liability insurance:
The amounts insured must be high enough
The top rule in personal liability insurance is: Choose the highest possible sum insured. A higher sum insured costs only a little more and pays off especially in the case of expensive personal injuries. Because the legal liability is unlimited, the coverage of your contract should also be very high, otherwise you will have to pay the rest from your private assets.
With 50 million euros insured, you are very well covered. Make sure that at least 10 million euros coverage is available for each injured person. This is the case with all of the tariffs we recommend.
The best performance guarantee replenishes the protection
With a best performance guarantee, the insurer promises you to behave like the best insurer in the German market in the event of a claim. This becomes important if you have caused damage, but your insurer takes the position that this area of life is not covered or that the compensation limit is insufficient.
If you can prove that another insurer pays in this case, the benefits of the other insurer also apply to your contract. The best performance guarantee therefore raises insurance coverage to the highest level available in Germany.
A tariff that includes a comprehensive best-performance guarantee is in principle better than a tariff that lists all conceivable services, but waives or restricts a best-performance guarantee. Our four recommendations Haftpflichtkasse, Axa, Bayerische and VHV offer a best performance guarantee.
With the Axa and the VHV this must be booked for an additional charge. Our prices include this. Incidentally, the liability insurance company refers to the guarantee in its contract documents as “extended provision”.
However, the best performance guarantee has its limits. It only applies to German insurers and only for benefits at the same tariff level. If you have basic protection, you cannot use the exclusive tariff of another insurer.
The best performance guarantee therefore only fills gaps that another insurer covers within the scope of private liability with a comparable tariff offer.
Bad debt loss: Well insured if others harm you
Cover in the event of bad debts is just as important as a high sum insured. It works like reverse liability insurance: you have suffered damage for which the person who caused it cannot pay – then your own insurance company will cover the costs, but some insurers only cover damage from 2,500 euros.
Pay attention to this clause in your liability comparison. Since 15 percent of all households in Germany do not have liability insurance, it is important to close this gap in insurance coverage.
Some tariffs require that you have obtained a final judgment against the perpetrator. For other providers, it is enough that you have demonstrably tried to get your money.
Depending on the amount of damage, the effort of filing a lawsuit is well worth it if you get your damage reimbursed in this way. Our four recommendations also cover bad debts.
Liability insurance comparison: families only need one contract
If you are married or live in a civil partnership, one liability insurance per household is sufficient. Until the end of their first vocational training, children are always insured through their parents in a family contract.
Children under the age of seven are only insured if the clause “persons incapable of tort” is included in the tariff. With the Axa, this must be explicitly secured for a surcharge. Our price inquiry includes the clause.
In the case of a family contract, however, you should note that claims for damages against co-insured relatives or relatives living in the household are partially excluded. This can be especially problematic if one partner accidentally hurts the other. Because then the health insurance of the injured party will claim back the treatment costs incurred from the person who caused the accident (recourse claims) – and that can quickly become expensive in the event of severe injuries.
You should therefore make sure that your insurance explicitly covers recourse claims from social insurance providers. Our four recommendations for Haftpflichtkasse, Axa, Bayerische and VHV do just that.
Couples who are not married to each other should ensure that the co-insured person is named in the contract.
Arrange a deductible
With a deductible you can lower the insurance premium. About 150 euros a year makes sense. Without a deductible, you can also report minor damage to the insurance company.
However, the insurer may terminate you as soon as the damage has been paid. After an insured event, he has a special right of termination. Attention: With VHV you always have to pay a deductible if you have reported two or more claims to the previous insurer.
Sometimes important: loss of keys
This clause is not a must, but it will save a lot of money in case you lose the keys to your rental apartment or office. Because the entire locking system in the house often has to be replaced afterwards. In such a case, the key insurance covers the costs.
If you live in an apartment building with many neighbors and a locking system, we recommend this clause.
Many access systems to office buildings are anonymized, and you can often not tell from the key or card to which complex they belong. In these cases, you probably don’t need such a clause for professional keys.
However, as soon as an exact allocation between key and office building is possible, key insurance is recommended. This is especially true for teachers, because in schools practically every key is a master key.
When does it make sense to switch to a new contract?
The tariffs have improved significantly in recent years: providers have increased their insurance sums and added new services. Unlike a few years ago, many insurance companies also pay for damage caused by computer viruses or small children. Complacency damages have also become an integral part of the tariffs.
If your contract is already several years old, it is therefore often worthwhile to switch to a tariff that is up to date. To change the contract, you have to cancel the old contract three months before the main due date. You can then look for a new, high-performance and affordable liability insurance policy in peace until the contract expires.
Drones have also been in vogue for a number of years. If you use a drone privately, inquire with your private liability insurance whether drone protection is included. Keep the written confirmation.
Otherwise, expand your insurance accordingly or look for a new, more suitable contract. If you use the drone commercially, you have to take out special drone liability insurance.
But even if your contract is only a year old, a change can be worthwhile. Once a year, usually in the middle of the year, the risks for the previous year are calculated. If they have changed, insurance companies adjust the premiums.
This is also stipulated in the terms of the contract. It happens again and again that insurance companies increase premiums by a certain percentage. This happens more often when the very cheap contributions are also used to acquire new customers.
If your insurance company announces a price increase without the benefits increasing, you can terminate your contract immediately without observing the notice period. But remember to look for a new provider beforehand so that there is no gap in insurance coverage.
In which cases do you need a special contract?
Even if you have chosen a very good tariff, not all risks are necessarily insured. There are some areas for which you need to take out special liability insurance.
Pet owner liability
Special dog liability insurance is required in six federal states. Find out what applies in your region. We recommend horse owners to take out horse liability insurance.
Secured on the construction site
As the client, you are responsible for what happens on the construction site. Builders’ liability insurance takes over if people are injured or objects are damaged on the construction site.
The construction insurance protects you in the event of damage caused by storms or vandalism to the shell. If the house burns down during the construction phase, a fire shell insurance covers the damage incurred.
Home and landowner liability insurance
If you own a tenement house or live in a home ownership community, you absolutely need home and landowner liability insurance. This takes over if you have violated your so-called traffic safety obligations. For example, if a pedestrian slips on the icy sidewalk in winter and breaks a leg because you did not scatter, the landlord’s liability pays damages.
If you own a single-family house in which you live, normal personal liability insurance is sufficient in such cases.
That’s how we tested
Test personal liability 2020
In November 2020, Finanztip selected the best tariffs based on the test by Stiftung Warentest (edition 10/2019), subjected it to its own evaluation and a comparison of liability insurance. We have placed the focus on the amount of coverage and the existence of a best performance guarantee. On this basis, we have filtered out those tariffs from the large number of offers that offer very good services and the most comprehensive best-performance guarantee and are also inexpensive.
Stiftung Warentest gave 104 tariffs a “very good” rating. In the first step, we calculated the mean value of the contributions (for families without excess). This was around 115 euros. In the following, we have only looked at posts that raise a maximum of this post.
Next, we excluded from further consideration those tariffs that offered insufficient coverage. We consider coverage of 50 million euros to be recommended. After all, 42 tariffs offer coverage of at least 50 million.
These tariffs also offer at least 10 million euros per injured person.
With these we checked whether the insurers promise a best performance guarantee. It also had to be possible to take out insurance online or at least apply for it online. We have sorted out those insurers who do not offer any or (in our opinion) no good best-performance guarantee, as well as those that do not allow online conclusion or online applications.
The Waldenburg Premium Plus tariff offers an online subscription. However, interested parties can only view the tariff conditions after they have provided all personal information. We therefore do not recommend this tariff.
That left four insurers: the liability insurance with the “Simply Besser Plus” tariff, the Axa with the “Haftpflicht Online L” tariff, the Bavarian with its “Prestige” tariff and the VHV with the “Klassik-Garant Exklusiv” tariff. We provide detailed information about our approach in our test article.