German Car Insurance in the USA: A Comprehensive Guide for German Drivers
When Germans visit or move to the United States, understanding how car insurance works in this new environment becomes crucial. The U.S. insurance system is significantly different from that in Germany. From liability policies to optional coverage types, the legal and financial implications of driving without proper insurance can be severe. Whether you're a German tourist renting a car, an expat moving for work, or a student planning a road trip, this guide explains everything you need to know about German car insurance in the United States.
1. Overview: Differences Between German and U.S. Car Insurance
In Germany, car insurance is highly regulated and typically includes:
-
Kfz-Haftpflichtversicherung (liability insurance) – mandatory.
-
Teilkasko (partial comprehensive) – optional, covers theft, fire, and glass damage.
-
Vollkasko (full comprehensive) – optional, includes collision and vandalism.
In the U.S., insurance works differently. Every state sets its own minimum requirements. However, the following are standard in most policies:
-
Liability Insurance – covers damage to others.
-
Collision Insurance – covers damage to your own car from an accident.
-
Comprehensive Insurance – covers damage from non-collision events (theft, fire, weather).
-
Uninsured/Underinsured Motorist Coverage – protects you if the other driver doesn’t have insurance.
The key difference is that in Germany, insurance is tied to the vehicle, while in the U.S., it’s usually tied to the driver.
2. Can German Insurance Be Used in the USA?
Generally, no. German car insurance is not valid in the U.S. if you’re driving a U.S.-registered vehicle. However, there are some exceptions:
a. Tourists Using Rental Cars
Most German insurance policies do not cover rental cars in the U.S.. You will need to:
-
Purchase insurance from the rental agency.
-
Use travel insurance that includes car rental coverage.
-
Use a credit card that provides rental car insurance (many German credit cards include this benefit).
Important tip: Always read the fine print of your travel or credit card insurance. Some may exclude the U.S. or have limited coverage for liability.
b. Germans Bringing Their Own Cars to the U.S.
If you’re shipping your German-registered car to the U.S. (e.g., during relocation or long-term stay), you’ll need special international car insurance that covers the U.S. This can be expensive and limited in duration (typically up to 6 or 12 months).
Companies like Hagerty, Thum Insurance, or Clements Worldwide offer such coverage.
3. German Expatriates: How to Get U.S. Car Insurance
If you're relocating to the U.S. for work or study, and plan to buy or lease a car, you'll need to purchase U.S. car insurance. Here’s how:
a. Choose an Insurance Provider
Popular providers in the U.S. include:
-
GEICO
-
State Farm
-
Progressive
-
Allstate
-
Liberty Mutual
b. Required Documents
You’ll typically need:
-
A valid driver’s license (your German license may be accepted temporarily).
-
Proof of address in the U.S.
-
Vehicle registration details.
-
International Driving Permit (IDP) if your stay is short-term.
c. Driving History and Credit Score
In Germany, car insurance pricing is influenced by your claims history (SF-Klasse). In the U.S., insurers look at:
-
U.S. driving record (which you won’t have yet).
-
U.S. credit score (as a risk indicator).
-
Age, gender, marital status, location.
This can make car insurance very expensive for new expats, as insurers treat them as high-risk drivers.
d. How to Save on Premiums as a German Driver
-
Ask if the insurer can consider your German driving history.
-
Choose a higher deductible.
-
Take a defensive driving course in your U.S. state.
-
Bundle insurance (e.g., auto + home).
-
Opt for usage-based insurance (UBI) programs.
4. Temporary Insurance for Short Visits
If you're staying in the U.S. for a few weeks or months, and plan to borrow or buy a car, consider short-term car insurance options. Some companies offer:
-
30-day to 6-month policies
-
Pay-as-you-go coverage
-
Non-owner insurance (if you don’t own the car but need liability coverage)
These are useful if you're staying with family and driving their car.
5. Rental Car Insurance: A Breakdown
Most rental agencies in the U.S. offer the following options:
-
Collision Damage Waiver (CDW) – waives damage costs.
-
Supplemental Liability Protection (SLP) – increases liability coverage.
-
Personal Accident Insurance (PAI) – covers driver/passenger injuries.
-
Personal Effects Coverage (PEC) – covers stolen items from the car.
As a German traveler, you should never assume you're covered by your domestic policy. Always ask your rental agency what’s included and decide accordingly.
6. German vs. U.S. Legal Requirements
| Feature | Germany | USA |
|---|---|---|
| Liability Insurance | Mandatory | Mandatory (varies by state) |
| Vehicle-Based vs Driver-Based | Tied to Vehicle | Usually tied to Driver |
| Minimum Coverage | High | Often Low |
| License Validity | German License + IDP accepted | Varies by state, short-term only |
| Credit Score Used? | No | Yes |
7. What Happens After an Accident?
In the U.S., after a car accident:
-
Call emergency services if necessary.
-
Exchange information (license, insurance, registration).
-
Take photos.
-
File a police report (especially if there’s injury or major damage).
-
Notify your insurer ASAP.
Even if you’re using German travel insurance or credit card coverage, you’ll often need to pay first and claim later.
8. Returning to Germany: Can You Transfer U.S. Driving Experience?
Yes, in some cases. If you’ve been insured and driving safely in the U.S. for years, German insurers might accept your U.S. driving record to place you in a lower risk class (SF-Klasse). You'll likely need:
-
A U.S. claims history report.
-
Letter of good standing from your U.S. insurer.
-
Driving record from the state DMV.
Not all German insurers accept this, but it’s worth asking.
Conclusion
Whether you’re a German traveler, expat, or international student in the U.S., understanding car insurance laws is essential to stay legal and protected on the road. German car insurance does not automatically transfer to the United States, and navigating the American system requires research and preparation.
Always evaluate your situation: Are you renting, borrowing, or buying a car? How long are you staying? What kind of insurance coverage do you already have?
By taking the time to understand U.S. car insurance and seeking coverage that fits your needs, you can drive safely and confidently across the country—without legal or financial headaches.