What kinds of motor vehicle insurance are there? Which damage items are eligible for reimbursement under motor vehicle liability insurance?
In Germany, motor vehicle liability insurance is a must for every owner of a motor vehicle, without which no vehicle can be licensed (compulsory insurance). The reason behind this rule is that those injured by a motor vehicle must at least have the certainty that they will be compensated for any damage or loss suffered. Such insurance thus covers property damage, personal injury, financial as well as intangible losses.
Comprehensive motor vehicle insurance is not a compulsory insurance, which is also why it does not have any statutorily defined minimum insurance scope. It covers damage to a person’s own vehicle. Here, a distinction is made between partial and fully comprehensive motor vehicle insurance. Normally, the risks covered by partial motor vehicle insurance are: fire, explosion, theft, storm, hail, lightning, flooding, glass breakage and wiring short circuits. Fully comprehensive motor vehicle insurance relates to the same risks, but additionally covers accidents attributable to policyholder’s own fault as well as wanton or malicious acts of third parties.
The purpose of roadside assistance contracts (Autoschutzbriefe) is to provide assistance in the case of breakdowns (e.g. towing expenses, shipment of spare parts excluding costs of repair), accidents (e.g. car rental and overnight accommodation expenses) or illnesses (medical repatriation).
Motor vehicle accident insurance provides insurance cover when passengers of the policyholder’s own vehicle are injured in an accident.
2. What is a temporary insurance coverage card (Doppelkarte) and what are its essential features?
From the time the policyholder applies for coverage until final conclusion of the insurance contract (= i.e. when the policyholder is sent the insurance policy), the policyholder does not have any insurance coverage. In order to bridge over this time interval, the companies concerned issue a "temporary cover note".
The temporary cover note establishes an independent legal relationship which has nothing to do with the subsequent insurance contract, it being perfectly possible that the insurance company will refuse an application for insurance. Temporary coverage ends when the insurance policy is sent to the policyholder. It is based on the scope of insurance applied for. The premium does not form an integral part of such insurance relationship and is usually deferred. In some cases, the companies also require advance payments. Generally, the policyholder is not entitled to cancel such temporary coverage (cf. section 8 (3) no. 2 of the VVG).
In motor vehicle liability insurance the insurance confirmation card, known as the (electronic) temporary insurance coverage card (Doppelkarte), serves as the temporary cover note.
When does the "green card" system apply and what are its essential features?
The Association "Deutsches Büro Grüne Karte e.V.“ (German Green Card Bureau, DBGK) is responsible when an accident involving a foreign motor vehicle has occurred in Germany.
You will find further information on reporting accidents as well as practical tips on the DBGK website. In particular, you will also find there a Leaflet for processing motor vehicle liability claims by the DBGK and the Association for the Assistance of Road-Accident Victims (Verkehrsopferhilfe e.V. – VOH) as well as information on how to make claims for compensation in the event of suffering damage abroad.
What should I keep in mind if I have been injured by or suffered loss from a motor vehicle abroad?
Since 1 January 2003, German drivers may claim compensation in Germany for damages resulting from a road accident suffered abroad (Fourth Motor Insurance Directive). In this regard, every insurer is required to appoint a claims representative in every EU Member State to whom damage claims can be addressed following an accident abroad. The name and address of such person can be inquired with the Zentralruf der Autoversicherer (central telephone service of car insurers) under the telephone number 0180-25 0 26 or via the Internet at http://www.gdv-dl.de/anmelde.html.
The time it takes to process an accident claim may not exceed three months. If the claims representative does not respond within that time, the injured party can turn to the Association for the Assistance of Road-Accident Victims to settle the claim (Verkehrsopferhilfe e.V., Glockengießerwall 1, 20095 Hamburg, Germany; tel.: 040/30180-0, fax: 040/30180-7070).
What are the main things to keep in mind when terminating motor vehicle liability insurance?
Policyholder’s termination options:
- Termination by expiry: Since most motor vehicle insurance contracts expire on 1 January, the termination notice must reach the insurance company no later than on 30 November.
- Termination in the event of loss/damage: The termination notice must reach the insurance company one month from when determination of the compensation is concluded.
- Termination on account of premium increase: The insurer must notify the policyholder of the premium increase no later than one month before the effective date of the increase. Since with most insurance companies increases in premiums take effect on 1 January, the termination notice in this case also must reach the insurance company no later than on 30 November.
- If the vehicle is sold, only the purchaser has a termination option. However, such termination is deemed to be automatic if the purchaser submits to the vehicle registration office (Zulassungsstelle) confirmation of insurance with another insurer.
The insurer is entitled to only one premium up to the effective date of the termination.
How high are the minimum sums insured in motor vehicle liability insurance?
The minimum sums insured differ depending on the type of claim:
- For personal injury the maximum compensation amount for each person affected may be limited to € 2.5 million. In the case of death or injury of three and more persons, the minimum sum insured may be limited to a total of € 7.5 million.
- For damage to property, the maximum amount of compensation may be limited to € 500,000, and
- For financial loss to € 50,000.
May I be refused by an insurance company even though this type of coverage is “compulsory insurance”? If so, for what reasons?
In Germany, insurers authorised to issue motor vehicle liability insurance coverage have a legal obligation to accept applications for such coverage (section 5 (2) of the Compulsory Insurance Act (Pflichtversicherungsgesetz – PflVG). However, the insurer may refuse an application if there are objective or local restrictions in the insurer’s business plan that oppose conclusion of insurance coverage or if the applicant was already insured with the insurance company and the insurance company:
- rescinded the contract for threats or fraudulent misrepresentation;
- has withdrawn from the contract due to a breach of the pre-contractual disclosure obligation or due to non-payment of the first premium; or
- has terminated the contract because the policyholder was in default with payment of premiums or after the occurrence of a loss event (section 5 (4) of the PflVG).
As a foreign national having lived for a long time in Germany, I had two traffic accidents over the past two years which I caused. After the last accident, my insurer terminated the insurance contract. I can’t find any other insurer. May an insurer refuse me because as a foreigner I am seen as a “risk”?
The termination by your last insurer was permitted because termination was effected following a loss event. Another insurer may refuse you only for very specific reasons. What exactly these reasons are can be seen from the previous question. However, refusal on the grounds of your foreign nationality is impermissible because that would violate the prohibition on discrimination of section 81 e of the Insurance Supervision Act (Versicherungsaufsichtsgesetz – VAG). An insurer may not use nationality as a criterion for concluding an insurance contract.
What do I have to do in the event of an accident?
Normally, you file your claims with the opposite party’s motor vehicle liability insurer directly. The right to do so is based on the direct claim existing against the insurance company. You can find out who the insurer of the parties to the accident is by specifying the car registration plate number to the central phone service of car insurers (tel. 0800-25 026 00 in Germany and tel. +49 40-300 330 300 from foreign countries or at www.gdv-dl.de/anmelde.html).
The claim notice must be filed in writing within two weeks. It is advisable to first report the claim to the insurer by phone. There you will also learn what proof (e.g. expertises, cost estimates, repair invoice) has to be submitted.