Thursday, 24 March 2011

Buying German car insurance

Our beloved Renault Scenic died unexpectedly. It all started when my wife rang me to see if the car is still OK to drive even though it was making a funny noise when it is braking. Not to tempt fate too much, I check the car into the mechanic. The problem turns out to be three major costly problems, a sensor has malfunction within the braking system, a belt has reached its end of life and needed to be replaced and the car is overdue for its regular service by 10000km. It was going to cost about 3500 € to get the car back on the road.

Given that we originally only paid 5000 € (some say that it was too much already), we opted to trade it in and get a new car.

Well, with a new car, I need to shop around for some insurance for it. The insurance needs to be the full insurance covering liability and comprehensive.

Along the way, I discovered the following things.

  • There are surcharges if you choose to pay quarterly (3% surcharge) or monthly (5% surcharge). So go annually or half yearly if you can.
  • Protect your insurance rating. We had a accident during the year and our rating went from a SF 10 to a SF 04. The higher the number, the lower your insurance cost. For us, this is a different of 30%. The rating goes down quickly, but goes up slowly.
  • Shop around. Using both and, we were able to get a comparison of some of the major German insurers. From this comparison, we were able to get a 10% discount from our current insurer's offer.
  • Internet insurers vs shop front insurers. Those who sell insurances online seems to cost a bit less.
  • A small car may not be cheaper to insure than a bigger car. Apparently if a lot of young people drives a particular type of car, the cost of insuring it will be higher even though the driver is not consider young any more.
After a few days of insurance shopping, I decided to stick with my current insurer as they can speak a good deal of English. I feel that my German is probably not good enough to deal with the insurers if something goes wrong.

Update: Since I had posted this article there are some items that is worth mentioning.

1. If you did get into an accident, it may be worthwhile considering paying for the damage yourself. This damage for your own car or the other parties. This will help to protect you insurance rating. For example, recently we had an accident where the side view mirror needed replacing. The cost was about 150 €, so opted to pay for it ourselves. If we had chosen to get the insurer to pay for it, our insurance rating would suffer and our premiums would have increased. When our insurance rating return to the same level, the difference in premiums would be more than 150 € that we paid.

2. If you have a second car, the insurance premiums for it will be different to your first car. It would start at the lowest insurance rating. A history will need to be built up to improve the rating and decrease the premiums.

3. I came across an nice summary, and much more details, on car insurance at Check it out.


G in Berlin said...

Thanks for the comment.
But bummer to take the car in for work and find you needed to get a new one!

tehnyit said...

G, it is definitely a bummer. At least with a new car, we can hope for a repair free period for the next few years. Fingers crossed!

WHunter said...

@tehnyit, You make a good point about the language barrier, I just got back from a two year stint in Germany for work and I know how difficult it can be to untangle a new country's rules when it comes to getting cars, machines, land, buildings, you name it.

We used to employ Swiss company Sinitus, with Urs Meisterhans to do our asset management thats and that advice was really useful, especially for myself and the other expats over there. If you're in the South of Germany, Switzerland or the region you could do a lot worse than to contact Urs Meisterhans.

That being said, anyone in the industry will be able to help. Auf Wiedersehen!

OlegNicolescu said...


Sorry if my english is bit difficult. it is not my mother tongue.

I co-manage a smaller European trucking supply chain and logistics company which travel across most Europe and East Europe.

I saw WHunter comment and I agree. Part of our advisory come from Sinitus and Urs Meisterhans. Excellent accountants and advisors, helped my company through difficult situations with financial.

ani_mal said...

hi, are there international insurance companies in Germany that offer international fully comprehensive car insurance?

would you be so kind and direct me somewhere?
My German is very poor :-)

Kind Regards

Bastien - SiB said...

Thanks for those little tips. They inspired me to do a more detailed guide for the ones that are not so familiar with the german process and/or language. :)

Here it is:

tehnyit said...

Hi ani_mal,

Thanks for stopping.

Not 100% sure what you mean by international, but most car insurance companies will have an option whether you are covered or not. In Germany, this would typically means being able to drive in neighbouring counties like France and Belgium.

When I received my insurance papers, it came with a list of countries that I am covered for and not covered for.

Hope that helps,

Business Spider said...

I have a question, if I have a car and I get a second one, the price of my current insurance increase,decrease or stays the same when I get one more car???
Auto Insurance would help me... at all??

Allen Fletcher said...

Whether it is your bike or car or any other vehicle, insurance is a must for everything. As it is not cheaper at-all to deal with a car repair if you face any accident or trouble in your car so it is better to have an insurance so that it will be affordable for you to take the expenses. It was so nice of you sharing your experience with us. Often it is difficult to get the right insurance for your car as it need to fulfill your requirements. It is better to get an insurance through a good auto dealer. They will recommended you a good insurance policy that will cover all your requirements.

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