Private liability insurance: An absolute must for everyone!

Anyone who causes damage to others through carelessness or recklessness is liable for the costs. This applies not only to a red wine stain on the tablecloth, but also to serious accidents and destroyed buildings. Taking out private liability insurance is essential!

Who needs what kind of protection?

Everyone should take out private liability insurance, as it protects against damages that can amount to millions of euros.

The following tariffs must be distinguished:

• In the single tariff, only you, as the policyholder, have insurance coverage.
• The family policy extends coverage to additional individuals. For spouses or partners in a cohabiting relationship, a single joint private liability insurance policy is sufficient. However, in cohabiting relationships, the partner should be specifically named in the policy. Children are generally covered as long as they are still in their first uninterrupted course of education or training.

For families and couples in committed relationships living together, family rates are generally cheaper than individual insurance.

Private liability insurance only covers private matters. Therefore, professional or business liability insurance can be important (especially for freelancers and the self-employed). For some professions, financial loss liability insurance is also advisable.

Additional liability insurance policies should be taken out, among other things:

• Home and landowners of rented or undeveloped land
• Pet owners, for example, of dogs and horses
• Owners of oil tanks (alternative insurance coverage may be possible, depending on capacity, by extending the coverage of existing private liability insurance)
• Operators of photovoltaic systems (insurance coverage may be possible depending on the nature of the system, through an extension of existing private liability insurance)
• Building owners (insurance coverage may be possible depending on the construction sum by extending the coverage of existing private liability insurance)
• Owners of motorboats, sailboats, model aircraft, and motor vehicles
• Public sector employees, due to the possibility of recourse claims by the employer
• Hunters:

When does private liability insurance kick in?

The liability insurer's task is to examine whether the claims for damages made against you are justified in the event of a claim. Liability insurance provides you with comprehensive protection in this regard:

• If the insurer considers the claims unjustified, it defends against them at its own expense and risk. Liability insurance, therefore, offers so-called "passive" legal protection.
• If the insurer deems the claims against you to be justified, then they will pay for the damage. This is conditional upon there being no exclusion clause in the insurance policy – ​​for example, that you did not cause the damage intentionally.

The injured party should not profit from the damage. The liability insurer must adhere to this principle. Therefore, the following regulations apply, depending on the type of damage:

• In the case of property damage, the repair costs are always paid. If the item is worth less after the repair than before, there is also a surcharge for this reduction in value.
• In the event of a total loss, the insured item's current market value is reimbursed. The current market value is the replacement cost of items of the same type and quality, adjusted for age and wear and tear. Therefore, as compensation for a used bicycle, the injured party would receive enough money to buy a similarly good, used bicycle.
• In the event of personal injury, claims can be made for medical and hospital costs, costs for alleviating suffering, compensation for professional disadvantages, costs for restoring the ability to work, pain and suffering damages, compensation for permanent damage (for example, pension payments), and other additional costs (for example, nursing staff).

How much insurance coverage should you get?

It is important to note that, in the aforementioned cases, the insurer will only pay up to the coverage limits specified in the insurance policy for personal injury, property damage, and financial loss. If the damage exceeds your insured amount, you will have to pay the difference yourself.

Therefore, make sure you have adequate insurance coverage. You should agree on a minimum coverage amount of €10 million. The insurance should cover this amount in all three areas – personal injury, property damage, and financial loss.

Better – and available for only a few euros more – are coverage amounts of 50 or even 100 million euros. 

Make sure that each individual risk is also insured for a sufficiently high sum. 

What is insured?

The insurance covers the risks of daily life. This includes, among other things:

• Neglecting the duty of supervision over minors (not only over one's own children, but also over other people's children)
• in case of breach of traffic safety obligations (for example, cleaning, gritting, and snow removal on sidewalks)
• as a pedestrian or cyclist (including e-bike riders ) in road traffic
• as a participant in private sporting activities such as football or tennis
• in case of damage you cause with your own or someone else's rowing and paddling boats, surfboards, or with someone else's (borrowed or rented) sailboats
• as owner of self-occupied real estate (holiday apartments, holiday home / weekend house, condominium)
• as a special owner in condominium complexes, due to damage to the common property

Essential basic protection

The following minimum standards should be covered by personal liability insurance:

• Private liability insurance should be valid worldwide. However, this usually requires that the stay abroad does not exceed one year. Within the European Union, the stay should be insured without any time limit.
• Adult unmarried children: Insurance coverage until one year after completion of all education.
• If children are also insured under the contract, Work placements for students and a waiting period of up to one year before the start of vocational training or military service are covered.
• Insurance coverage for the loss of someone else's private apartment keys or work keys
• Insurance coverage for damage to rented premises and buildings up to at least 500,000 euros (also for rented holiday apartments and event spaces)
• Damage caused by electronic data exchange or internet use is insured for at least 50,000 euros.
• Private care of other people's dogs and horses is also covered by the insurance.
• Gradual damage, for example, moisture damage that is only discovered later, and damage caused by domestic wastewater
• The risk of water pollution from commonly used household substances, such as paints, varnishes, and heating oil in small containers with a capacity of up to 50 liters/kilograms, is also covered, provided that the total capacity of the existing containers does not exceed 250 liters/kilograms.
• Coverage for claims against uninsured parties up to 10 million euros (if you are harmed by others who are not covered by liability insurance and cannot pay for the damage themselves, it is important that your liability insurance steps in and pays for the damage)
• Coverage of at least three million euros for personal injury and property damage, and at least 50,000 euros for financial losses. For example, you have private liability insurance and get a dog, for which you need pet liability insurance. Until the next premium payment is due, the dog is then covered free of charge.
• If needed: Insurance against liability risks in voluntary activities
• If needed: work as a childminder
• If liability claims of the partner and their children against the policyholder are excluded, any transferable recourse claims from social security institutions, social welfare agencies, private health insurance companies, public and private employers for personal injury are also covered.
• Damage caused by acts of kindness: If you help others at their request (for example, with moving) and cause damage through simple negligence, you are generally not liable for compensation. You should discuss such favors with the other person beforehand and clarify their insurance coverage.

Extension of basic protection

Some of these coverage extensions can be included in the policy at no extra charge:

• Children incapable of committing a tort: ​​Children who have not yet celebrated their 7th birthday cannot be held legally responsible for damages. In cases of damage in moving traffic, children are only liable from the age of 10. If the parents have not neglected their duty of supervision, the injured party will not receive compensation. However, you can look into a liability insurance policy that covers children incapable of committing a tort – this can help avoid conflicts if your child causes damage.
• Other persons incapable of committing a tort: ​​People with disabilities or dementia who are unaware of their actions may be classified as incapable of committing a tort and are therefore not liable for any resulting damages. It is advisable to review the policies of affected individuals and their relatives (keyword: duty of care) to identify a clause addressing incapacity to commit a tort, and to amend the contract if necessary. This can make it easier for all parties involved to resolve any damages, for example, within one's circle of acquaintances, friends, or neighbors.
• Holiday apartment/house rental abroad
• Construction projects with a construction cost of at least €100,000
• Photovoltaics: Anyone operating a photovoltaic system can be held liable for damages caused to third parties by the system. This could include, for example, a fire spreading to a neighbor's roof or a solar panel being torn down by a storm and hurled onto a car. Alternatively, one can protect oneself with a separate photovoltaic operator's liability insurance policy.
• Heating oil tank: Many private liability insurers offer coverage for above-ground and, in some cases, underground heating oil tanks up to 5,000 liters. For larger tanks, it may be necessary to take out water pollution liability insurance.
• Borrowed and rented items
• Liability claims between co-insured persons
• Drones (depending on the type)
• Mallorca policy (supplementary protection for a car rented in the EU if the liability insurance for the rental car is insufficient) 

When is insurance coverage at risk?

In the event of a liability claim, you must not acknowledge the injured party's claim or pay damages without the insurer's written consent. Therefore, do not sign any admission of guilt and do not make any payments. Doing so could jeopardize your insurance coverage.

You must report the damage to your insurance company immediately.

How is the contribution calculated?

Tariffs are offered for singles, married couples without children, families, and members of certain professional groups. This naturally also affects the cost of the contracts.

Agreeing to a deductible per insurance claim reduces the premium, but usually results in so little savings that you are better off doing without it.

It is usually cheaper to pay the insurance premium once a year rather than in monthly installments.

How can the contract be terminated?

Insurance contracts can be terminated with (usually) three months' notice before the end of the term. The contract automatically renews without notice for another year. After that, the contract can be terminated annually – again with three months' notice.

Furthermore, you can cancel your contract if there in damage or a premium increase.

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