Car Insurance in Germany: A Comprehensive Guide (2025)
Car insurance is not just a legal requirement in Germany but a critical component of responsible vehicle ownership. With a highly regulated insurance industry and one of the most developed road networks in Europe, understanding how car insurance works in Germany is essential for both residents and foreigners planning to drive or live in the country. This article will walk you through everything you need to know about car insurance in Germany in 2025, including types of coverage, costs, legal requirements, providers, and tips for getting the best deal.
1. Overview of Car Insurance in Germany
Germany has strict regulations when it comes to road safety and vehicle insurance. Every car driven on German roads must have at least a minimum level of liability insurance. Driving without it is illegal and can result in heavy fines, license suspension, or even imprisonment in serious cases.
Car insurance in Germany is broadly categorized into three main types:
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Liability insurance (Haftpflichtversicherung)
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Partial coverage (Teilkasko)
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Comprehensive coverage (Vollkasko)
2. Legal Requirements
Mandatory Liability Insurance
By law, all car owners in Germany must carry liability insurance. This policy covers:
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Injuries to other people
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Property damage
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Damage to other vehicles
Without this insurance, a vehicle cannot be registered, and you cannot legally drive on public roads. This coverage ensures that in case of an accident, the victim receives compensation, even if the driver at fault cannot afford to pay out-of-pocket.
The minimum coverage amounts as of 2025 are:
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€7.5 million for personal injury
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€1.12 million for property damage
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€50,000 for financial loss
Most insurers offer much higher coverage than the legal minimum, often up to €100 million.
3. Optional Coverage
Teilkasko (Partial Coverage)
Teilkasko is optional but highly recommended. It covers:
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Theft
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Fire and explosions
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Storm, hail, lightning, and flooding
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Glass damage (e.g., broken windshield)
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Animal collisions (e.g., deer)
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Vandalism (partially)
Vollkasko (Comprehensive Coverage)
Vollkasko includes all Teilkasko benefits plus:
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Damage to your own vehicle caused by an accident (even if you are at fault)
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Vandalism (full protection)
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Hit-and-run incidents
This is ideal for:
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New or high-value vehicles
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Inexperienced drivers
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Leasing or financed cars (often mandatory by lender)
4. Cost of Car Insurance in Germany
The cost of car insurance in Germany varies significantly based on several factors:
4.1. Factors Influencing the Premium
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Driver’s age and experience
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Driving record (accidents, fines, etc.)
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Type and age of vehicle
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Annual mileage
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Location (urban areas tend to be more expensive)
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No-claims bonus (Schadenfreiheitsrabatt)
For example, a 35-year-old driver with 10 years of driving experience and no accidents might pay around €350 to €600 per year for liability insurance. Adding Vollkasko can raise that to €900–€1,500 depending on the car model.
5. No-Claims Bonus (Schadenfreiheitsklasse)
One of the biggest cost savers is the no-claims bonus, known in Germany as Schadenfreiheitsklasse (SF-Klasse). Each year you drive without an accident, your SF-Klasse improves, which reduces your premium. A driver with 10 years accident-free history might get up to 70% discount on the base premium.
If you're a newcomer to Germany, some insurers may accept your no-claims history from your home country, but you’ll need official documentation and a translation.
6. Choosing an Insurance Provider
Germany has a competitive car insurance market with both large and niche providers. Popular insurance companies include:
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Allianz
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AXA
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HUK-Coburg
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DEVK
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ERGO
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R+V Versicherung
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DA Direkt
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Check24 (comparison site)
When comparing offers, pay attention not only to price but also to:
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Customer service ratings
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Coverage details
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Contract terms
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Claim process reputation
Online comparison platforms like Check24.de or Verivox.de are great tools to find competitive rates and tailor policies to your needs.
7. Registration and Insurance
You cannot register a car in Germany without having insurance. When buying a vehicle, new or used, you will need:
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eVB Number (Elektronische Versicherungsbestätigung): a digital confirmation from your insurer proving you have coverage.
This number is required at the Zulassungsstelle (Vehicle Registration Office). After registering, your license plates and official registration documents are issued.
8. Car Insurance for Foreigners and Expats
Foreigners who plan to live in Germany long-term must register their vehicle locally and switch to German insurance within 6 to 12 months. Expats should:
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Transfer no-claims history if possible
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Choose English-speaking providers (if needed)
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Understand that prices might be higher in the first few years
EU driving licenses are accepted without additional requirements. Non-EU drivers may need to convert their licenses depending on their country of origin and the duration of their stay.
9. How to Save on Car Insurance
To reduce your insurance costs in Germany:
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Choose a higher deductible (Selbstbeteiligung) to lower premiums
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Limit your annual mileage (lower mileage = lower risk)
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Park in a garage (adds safety and reduces risk)
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Pay annually instead of monthly
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Drive accident-free to earn no-claims discounts
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Use online-only insurers (usually cheaper due to lower overhead)
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Avoid unnecessary coverage if you drive an older car
10. What to Do in Case of an Accident
In the event of an accident:
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Stop immediately and ensure safety
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Call police if there is injury or serious damage
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Exchange details with the other driver (name, address, license plate, insurer)
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Take pictures of the scene
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Notify your insurer immediately
Your insurer will guide you through the next steps. Most companies offer 24/7 claim support.
11. Future Trends (2025 and Beyond)
As of 2025, the German insurance industry is embracing digital transformation, including:
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Usage-based insurance (UBI) based on driving behavior
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App-based management and claims processing
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Integration with connected vehicles and autonomous driving systems
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Discounts for eco-friendly vehicles and electric cars
Sustainability is also becoming a consideration, with some insurers offering green policies or planting trees based on driver performance.
Conclusion
Car insurance in Germany is a vital and well-regulated part of vehicle ownership. Whether you’re a long-term resident, an expat, or a new driver in Germany, understanding how the system works will help you stay legal, protected, and financially smart.
From mandatory liability coverage to comprehensive plans, and from premium-saving tips to accident procedures, being informed puts you in the driver’s seat — both literally and financially.
If you're planning to drive in Germany in 2025 or beyond, make sure to review your options carefully and compare multiple offers to get the best deal tailored to your needs.