Car insurance is one of the most expensive contracts of the year – and one of the least understood. Here are the building blocks.
Liability: compulsory for every car
No car may be driven without motor liability insurance (Kfz-Haftpflicht, § 1 PflVG). It pays for damage you cause to others – never for your own car. Legal minimums per claim (Annex to § 4 PflVG, since April 2024): 7.5 million € for personal injury, 1.3 million € for property damage, 50,000 € for pure financial loss. Most contracts offer a flat 100 million €, which consumer advice centres recommend.
Partial vs. full comprehensive
Comprehensive cover (Kasko) is optional and protects your own car:
- Partial (Teilkasko): theft, fire, storm, hail, lightning, flooding, glass breakage, wild-animal collisions – often also marten bites and short circuits. No no-claims class here: a claim does not downgrade you.
- Full (Vollkasko): everything above plus damage you caused yourself and vandalism. It has its own no-claims class.
Type class and regional class
The German insurers’ association (GDV) grades every car model and every registration district each year:
- Type class (Typklasse): claims and repair costs of the last three years for around 33,000 models. Scale: liability 10–25, partial 10–33, full 10–34.
- Regional class (Regionalklasse): the same for the 413 districts, based on where the owner lives. Liability 12 classes, partial 16, full 9.
Published every September (most recently 9 and 30 September 2026 for 2027), not binding for insurers but used almost everywhere; existing contracts change from the next insurance year.
No-claims class, deductible, workshop clause
- No-claims class (Schadenfreiheitsklasse): every claim-free year lowers your premium; a liability or full claim downgrades you the following year, often by several steps. Small claims are worth calculating – paying yourself can be cheaper. No-claims protection works only with your current insurer.
- Deductible: a fixed amount per comprehensive claim, commonly around 150 € (partial) and 300 € (full).
- Workshop clause: partner workshops for comprehensive claims in exchange for a lower premium – check leasing and warranty terms first.
Cancellation: 30 November and special rights
- Ordinary: most contracts end 31 December; with one month’s notice your cancellation must reach the insurer by 30 November (§ 11 VVG).
- Premium increase without better cover: cancel within one month of receiving the notice (§ 40 VVG). A worse type or regional class alone is not enough – the premium must actually rise.
- After a claim: both sides may cancel up to one month after settlement (§ 92 VVG).
More: notice periods overview.
How to proceed
- Read your policy: sum insured, cover type, deductible, no-claims class.
- Check the autumn premium notice – a higher premium for the same cover starts your one-month window.
- Compare like with like: 100 million € cover, no-claims protection, workshop clause.
- Secure the new cover first, then cancel – never leave a gap.
General information, not legal, tax or investment advice. Sources: German Compulsory Insurance Act (§§ 1, 4 and Annex PflVG), Insurance Contract Act (§§ 11, 40, 92 VVG), German Insurance Association GDV (type and regional class statistics 2027, press releases of 9 and 30 September 2026), consumer advice centres, Finanztip, ADAC – as of October 2026. Want to know whether your contract still fits? Get in touch.
