Private Liability Insurance

What kind of insurance is this private liability? What does it cover?

It is all about covering the damages you did, when you acted goofy! The basic rule is that the situation prevailing before the incident should be restored. According to the law, the insurance company must replace the current value of the items which were damaged or destroyed (§249 BGB) The rules distinguish between personal damages, material damages, financial damages and material damages to rented property.

Aha. What do you mean with personal damages?

Such will be the case, when someone is injured, their health is ruined, or they may even die. In addition to the direct costs such as medical bills and therapy, compensation may be required for the loss of income and other career problems caused. Compensation for pain and suffering is included in this category.

What is covered with financial damages?

These are such losses in money which have no direct connection with personal or material damages. This will be the case, for example, when one spouse can't take care of the household due to an accident because she or he is hospitalized.

You mentioned material damages. Are these damages such that materialize when I am supposed to come up for damages?

Not really. This will be damages to or destruction of physical items such as clothing, or sports equipment, and cars (outside of traffic).

Is there anything not insured? I bet they will always have some loopholes to escape liability.

Oh, sure they have loopholes! Or did you honestly believe they pay for everything? The most important exclusions are:

damages which are caused intentionally,

damages connected to criminal activity,

damages caused between people who are covered by the same contract (such as husband and wife),>

damage to glass in rented residential property (alternative coverage is available for this).

Hey, while trying digest their STC and especially exclusions, I noticed that my greatest worry is not covered. Is there anything I can do about it?

First of all, determine "exactly" which coverage you are missing. Then make an appointment with your insurance agent and discuss this with him. Either this issue can be covered with a surcharge or it is already covered in certain special policies - if it is insurable at all.

This private liability sounds great, especially when I think of my little ones. Please relieve my fears by telling me that any and all mischief of our minors will be covered by such insurance.

Well, a lawyer would want to start differently to answer your question. Are children liable for their "Oh, ohs"? Children younger than 7 years old are not considered responsible for their actions and even their parents are not necessarily considered liable for damages they cause. For more information on this topic please visit the page on torts. Nonetheless most insurances provide basic coverage. Basic coverage means that only legal responsibility will be covered - no more no less. Consider taking out enhanced coverage which also pays for damages which are not legally obligatory and which would not be refunded by a standard insurance contract.

Typical! Those who need the most protection are excluded or need special coverage. Why aren't children fully covered?

Because many incidents caused by young children happen in the homes of friends and family. In such cases you would wish to have the matter settled whether or not you are legally obliged.

An example: Mr. and Mrs Typical visit a friend´s garden party with their 5-year old son Vincent. The front gate is securely closed and so the children can play in the garden without constant supervision. Suddenly Vincent proudly shows his stunned parents the "picture" he has "drawn" with a stone on the host´s car which was parked in the driveway. Although the parents would clearly feel morally responsible for the damages, the law does not oblige them to pay. A standard liability insurance would follow the legal obligation and refuse any claim as unfounded. If your contract includes the enhancement „Schäden durch nicht deliktfähige Kinder (Damages by children below the age of responsibility)", the insurance will pay up to the maximum limits stipulated in the contract.

In my forgetfulness I somewhere lost my keys. And to top this disaster, my landlord wants me to pay for new locks in the house. Come on, I'm not Rockefeller. Of course, I will pay for my own keys but I am reluctant to pay for all others in the house. Will my insurance not cover this?

If you lose your house keys, the safest thing to do is to have all the relevant locks changed! Do or let this be done first before any other discussion!! The loss of keys is not typically covered by a standard liability insurance. When this is of importance to you take out enhanced coverage known as „Privater Schlüsselverlust" which can refund the costs of changing the lock, temporary locks where necessary, or supervision of the property for up to 14 days. Damages for lost keys will easily soar up to a four digit sum, when you live in an apartment building.

Who can be insured?

Single Tariff

Family Tariff

Policy holder



Spouse (also including civil partner)



Life partner



Minor children



Adult children (single, during education)


- Other people living in the household

- Disabled children (no age limit)

- Widowed parent, au pair, exchange student living in household

- People employed in the household


Depends on the tariff.
Ask for special information if any of these points apply.

(insurance company must be informed of person´s name)


If your friends or family are moving home, then you´ll probably be willing to lend them a hand. But are you covered by your insurance if you drop their new electronic equipment and damage it?

Not automatically! The legal position is clear: the person who is doing someone a favour is not liable if no gross negligence or purpose is involved. The standard insurance policy will reject the claim as unjustified. To avoid unpleasant situations look out for the enhancement „Gefälligkeitsschäden" which will include coverage for such cases.

Do you sometimes borrow a laptop from a good friend? Be careful! Are you really sure that your private liability insurance will cover this damage?

Damages to items you have borrowed are a classic case for exclusion according to the standard rules of liability insurance. Remember that one clumsy move is enough for you to knock your cup of coffee over the laptop and ruin it. Only a few top quality insurances offer coverage in such cases. And even when you do have such coverage they might not cover the full value. This is called „Schäden an gemieteten bzw. geliehenen Sachen".

Standard private liability insurance covers the damage you cause to rented accommodation (Mietsachschäden). Is there any kind of codicil or enhancement for this situation?

Coverage for rented accommodation may however be limited to damage to the building substance and to items permanently fixed within the building (such as the bath tub). But what if your romantic candlelight dinner in your holiday home results in a fire, ruining the furniture and decorations? This enhanced coverage means that the costs for the inventory are also refunded.

Knowing my insurance company well, they bring out some kind of new coverage on a frequent basis. Is there not a possibility to be always up to date?

The insurance world is also subject to constant innovation and product development. If you always want to be up to date, you need to rework your policies on a frequent basis. Some insurers include such an option. When such improvements lead to a higher premium, you have the statutory right of refusal. You can have the extraordinary right to terminate the contract. (§40 VVG) §

Hey that sounds cool. Whenever my insurance gets more expensive, I can instantly change insurers. Right?

Almost. §40 VVG gives you the right to give extraordinarily notice to the contract in the case your insurance company changes its premium without changing the scope of coverage. In other words, when you insurance wants to raise its bill only to compensate rising costs, they can do so but you have the right not to accept it by switching to another company.

And what happens, when I used to live in house full of big glass doors and windows and now moved to a house with significantly less grand windows. Do I have the right to reduce the premium?

Oh yes, you do (§41 VVG)! Once you inform your insurance company on this reduction, they will have to reduce the premium in accordance to the reduction of the risk. §

Basic contents provided by: Keith Tanner

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