Necessary insurance Photo: KSK Weilburg / DSV
It feels like there is insurance for every situation in life, every valuable item and every part of the body. But what really has to be, what is also useful and what can be safely left aside?
Over-cautious and well insured.
This is how you imagine the typical German. The truth, however, is different, as the Federal Statistical Office found out in 2018: of the 60,000 households surveyed, a large number were not adequately protected against existential risks. Of course, different households need different insurance coverage. However, there are two types of insurance that are a must for everyone: health insurance and personal liability insurance. Car owners also need motor vehicle liability insurance and pet owners in some federal states also need so-called animal liability insurance.
Regardless of whether it is statutory or private: health insurance is mandatory for everyone in Germany. The statutory health insurance (GKV) is open to everyone, with a few exceptions, and for most of them it makes more sense than private insurance. However, this can still be used. Prerequisite: You earn at least 60,750 euros (2019) as an employee, you are self-employed or a civil servant. In some cases, students also have the option of choosing between private and statutory health insurance.
Personal liability insurance
In everyday life it can sometimes happen very quickly: you are not paying attention and you accidentally knock someone’s smartphone out of their hand. You open the car door and don’t see a bike parked in front of it. You help a friend move and break an old mirror. Or in the worst case: You cause an accident in which a person is injured or even killed. The damage that occurs unexpectedly can sometimes be extremely expensive. It is not uncommon for the polluter to face existential costs. Private liability insurance is therefore a must for everyone – even if it is not required by law. Contracts are available from around 5 euros a month. In addition, not everyone has to conclude their own contract: Those who are also insured through their parents (up to the age of 25) or their partner are well covered.
Motor vehicle liability insurance
The legislator prescribes: If you register a car in Germany, you have to be able to prove that you have a motor vehicle liability insurance. This takes care of damage that you cause in traffic – and that is often very expensive. If you are often traveling in a rental car in other European countries, the so-called Mallorca Policy is also recommended. This then also covers damage to your rental car. If, on the other hand, you drive your own car abroad, insurance against damage abroad may make sense. By the way: In contrast to motor vehicle liability, comprehensive insurance is voluntary. This – whether fully comprehensive or partially comprehensive – regulates the damage to your own car.
Pet owner liability insurance
Owners of larger animals – such as dogs or horses – require animal owner liability insurance depending on the federal state. In Berlin, Hamburg, Lower Saxony, Saxony-Anhalt, Schleswig-Holstein and Thuringia this is always mandatory. In Bavaria or Baden-Württemberg, for example, this is only required for certain animals. Damage caused by smaller animals is covered by personal liability insurance.
Professional Liability Insurance
Not everyone who works needs it – but it is mandatory for some professions: professional liability insurance. Doctors, notaries, tax advisors and auditors or tax auditors must take out a professional liability policy.
Important insurance Photo: KSK Weilburg / DSV
Regardless of whether you work as a secretary, master carpenter, employee in the field or as a teacher: Ultimately, in all professions there is a risk of becoming incapacitated at some point – for various reasons. Since the statutory disability pension is often not sufficient to make ends meet, it is advisable to take out occupational disability insurance. It is best to complete this as early as possible. Because the younger and therefore hopefully healthier you are, the less you pay for a BUV. Or the other way around: If you already have previous illnesses or are chronically ill, you pay risk premiums or no longer receive any insurance at all.
Term life insurance
If the main breadwinner in a family dies, it is often financially ruined for the bereaved. After all, who will continue to pay the rent or the house installments when there is only one income left? Who pays for everyday costs, especially when there are still children involved? And how do they get by if their single parent suddenly dies? Anyone who cares for one or more others needs term life insurance. This takes care of relatives should the main breadwinner die and pays them a previously agreed death benefit. Nevertheless, only around 17 percent of Germans have taken out term life insurance (source: Federal Statistical Office).
Property owners protect themselves against natural hazards with residential building insurance. This covers damage caused by storms, hail, fire and lightning. If you live in areas where there is a risk of flooding, we recommend that you take out natural hazard insurance as an add-on.
International travel health insurance
It is true that health insurances also pay if they fall ill or injure themselves in another European country. However, it often does not cover all costs. You have to pay for treatments that go beyond what is customary in the holiday destination. Especially when it comes to the return transport, enormous costs are often incurred. Health insurances do not usually pay this. There is travel health insurance for these cases. You can also conclude these with your insurer as well as with special providers. With a contribution of around ten euros a year, the investment is worthwhile, as a return transport can cost several tens of thousands of euros.
Since the statutory pension will not be enough for many to finance themselves in old age, everyone should take out additional cover. There are many possibilities for this: state-subsidized or company pension schemes or private pension schemes. Here you can find out which old-age provision suits you and your life situation.
Which insurance are useful Photo: KSK Weilburg / DSV
The study by the Federal Statistical Office 2018 also shows that 76 percent of Germans have household insurance. This protects you in the event that valuable items in your household are destroyed, for example, by fire, vandalism, a break-in or a storm. Household contents insurance costs from 50 euros per year, depending on the amount insured. You can easily find out whether you need them: After a total loss, could you raise money for new furniture, clothing or electronic devices without getting into financial difficulties? If not: protect yourself. By the way: Household contents insurance usually also protects your luggage when traveling. Luggage insurance is therefore also not necessary.
Private accident insurance
All working people are covered by the statutory accident insurance in the event of an accident at work or occupational diseases. If, on the other hand, you are injured in your free time in an accident or while doing sports or if you are permanently absent from your job for other reasons, private accident insurance will help. It is the alternative for those who do not receive disability insurance.
Travel cancellation insurance
Travel cancellation insurance is recommended, especially for trips that are booked well in advance or that are particularly expensive. Pay close attention to the details of the policy: under what circumstances can you actually withdraw from the trip?
Supplementary care insurance
The Long-Term Care Strengthening Act of 2017 did not change the fact that state support for long-term care costs in old age is generally insufficient. If you don’t have children or other relatives to help you, you can quickly get into financial distress. If you would like additional protection, you can either invest in daily care allowance insurance, care cost insurance or care pension insurance. Similar to occupational disability and term life insurance, the contributions for private long-term care insurance increase the older you are.
Which insurance are compulsory?
There are two types of insurance that are a must for everyone: health insurance and personal liability insurance.
Car owners also need motor vehicle liability insurance.
In certain federal states, animal liability insurance is also required.
Which insurances are important for single people?
Single people and singles need health insurance and should also take out liability insurance. If you are raising children, you should also invest in term life insurance. Disability insurance is also recommended as a single.
What insurance do families need?
Families should have both health and liability insurance. A household insurance is also recommended. At least one worker should also have occupational disability insurance. Since it quickly becomes financially tight when a parent dies, term life insurance is also recommended.
Which insurances are important for students?
Students must have health insurance and should also take out liability insurance to protect themselves from costs that can arise from self-inflicted damage to someone else’s property. Immediately after graduation, it is advisable to think about occupational disability insurance, as these are usually cheaper for young people.
What insurance do homeowners need?
Homeowners need homeowner insurance that will protect them from damage caused by storm, hail, fire, and lightning. In areas where there is a risk of flooding, we also recommend insurance against natural hazards.
Which insurances are important for the self-employed?
In addition to compulsory insurance, the self-employed require business liability insurance, as they are liable for damage that they or their employees cause to third parties during working hours. It is important to check exactly what risks actually exist for your company and to ensure that insurance covers precisely this damage. For the self-employed, we recommend the daily sickness allowance, which compensates for the loss of income due to illness.
What insurance do tenants need?
It may be advisable to take out legal protection insurance. This can always be helpful if there is a dispute with the landlord and a matter ends up in court. Legal protection insurance can often be taken out through a tenants’ association.