3rd Party liability – indemnity insurance
Third party liability insurance (indemnity insurance) covers liability claims from third parties, protecting the policy-holder from potential economic ruin.
Anyone doing damage to third parties is legally obliged to compensate the damaged person. You can get a quote for a good insurance coverage HERE
This refers to:
- Damage to persons
- Damage to property
- Financial damage
Simple cases of a leaking dishwashing machine or laundry-washing machine can already cause several thousand EUR worth of damage you’ll have to pay for. Much worse if you cause injury to others while riding your bike or crossing the sidewalk or road with your head in the air….to name just a few typical examples. Our very own Starshollow has written extensively on Expat-forums in Germany about this: https://www.toytowngermany.com/forum/topic/366521-3rd-party-liability-one-again-yes-you-need-it/
Indemnity insurance reimburses the expenses for damages in the private sector (for your business you need a separate coverage!), including damage caused by negligence, up to an agreed amount. This is very important, as damage liability is NOT limited in Germany, and could cost the injuring party all their property and future earnings. Some Expats find this out the hard way, as is often reported on Expat-forums such as Toytown. Herer are just some typical examples:
http://www.toytowngermany.com/forum/index.php?showtopic=196349 – in this case someone cause by neglegence a tram to make an emergency break in Munich and was consequently facing thousands of EUR in claims
http://www.toytowngermany.com/forum/index.php?showtopic=203741 – in this case someone crashed with her bicylce into a car and is held liable for the dames
http://www.toytowngermany.com/forum/index.php?showtopic=333881 – this is about accidental damage in a hotel for which the guest was held liable
http://www.toytowngermany.com/forum/index.php?showtopic=293567 – this is about claims from a kindergarten for damages caused by a child
One of the important benefits of a good 3rd party liability insurance is also your legal representation. If somebody thinks he has a claim against you, he will use a lawyer or court to enforce this claim. Without a liability insurance – even if you are entirely guilt-free – you’ll have to fend this off with your own money, hiring lawyers and paying for court fees. If you have a 3rd party liability insurance, they will take this over because it is in their own best interest to beat off or at least reduce the claims as much as possible because they will pay for that in the end…
What is important in a good 3rd party liability insurance and what does it cost? A good insurance will cost between 60-90 EUr for single and 80-120 for families…per YEAR ! So we are not talking not really about a big expense.
The really important coverage described in details is described below:
What should third party liability insurance coverage include?
Private third party liability insurance ‚performs‘ (comes into effect) for damages to persons, property or finances.
Protection differs among the numerous tariffs. Coverage should include a lump-sum insurance sum of at least 5 million Euro for damages to persons and property. Really good ones offer coverage for 10 million EUR or even 50 million EUR. While this may seem excessive, a serious injury to one or more people caused which leaves them disabled or dead can amount to several millions worth of claims easily.
Furthermore, they should comprise the following benefits:
• Allmählichkeitsschäden – incremental damage through temperature, gas, damp, steam, rain etc. These should be covered by at least 3 million Euro.
Example: the insured person has damaged a line while drilling a hole in the wall and water leaking from that hole over time causes damage. Insurance will perform in this case.
• Computer damage: Damage to third party computers should be covered up to € 50,000. Example: an unintentionally transferred computer virus causes damage to third party computer.
• Domestic sewerage: Insurance should take over damages up to 3 million Euro. Such damages could result from a blocked pipe or a cracked washing machine tube.
• Damage to rented property: This covers when renting a property and must apply for a rented property, rented holiday property, or a leased garden plot. Damages up to €300,000 should be covered. ATTENTION: breakage of glass and damage to heating are generally excluded from coverage!
• Overseas: Coverage should be fully valid during limited stays abroad, at least three years within the EU and one year worldwide. Rental of a holiday property abroad should also be included.
IMPORTANT TO FAMILIES:
• Deliktunfähige Kinder: Children can only be held partly responsible for damage caused if they are not the children of, or under the supervision of, the insured person. This goes for children up to the age of seven. If this option is chosen, insurance covers up to €5,000 for damage to persons and property.
• Full age single children: If this option is included, damages should cover up to 3 million Euro. Protection applies up to one year after the conclusion of professional education or during a one-year waiting period for a second apprenticeship.
IMPORTANT TO TENANTS:
• Loss of private third party keys: Damages up to the amount of €5,000 should be covered under this option. Sometimes an excess applies. If you lose your keys to an appartment building, the entire lock system might need to be changed, which can cost a lot of money
IMPORTANT TO EMPLOYEES:
• Loss of job-related third party keys: Damages up to the amount of €5,000 should be covered. If your office or factory building uses a sophisticated lock&key system, a lost key may result in large costs for changing the entire system.
IMPORTANT IN CERTAIN SITUATIONS:
- Forderungsausfalldeckung: Covers if someone without third party liability insurance causes damage and cannot pay for damage or injury. Damages up to the amount of 3 million Euro are covered. The minimum amount of damage which is provided by the insurance company must not exceed €2,500. Usually the client has to pay court fees. Example: You are accidentally run over from behind by a cyclist on a pavement or maliciously attacked and robbed – we cover your compensation claim. Even if the person responsible is not insured or unable to pay.
- Gefälligkeitshandlungen – unentgeltliche Hilfeleistung: if, for example, the insured person helps someone move house (without being paid) and drops the Ming vase, this is covered through insurance. At least €5,000 is covered, though sometimes only for damage to property.
- Damage to rented, leased or lent property: Up to €5,000 is covered. Damages in connection with the rental or leasing of vehicles is excluded.
We also hold the following coverage – which only one or two insurance tariffs currently offer – as important coverage for Expats in general, and for those who look „foreign“ in special. While Germany is probably not more xenophobic than any other country in the world, racially motivated hate-crimes do happen and therefore extra coverage that pays to you if you become a victim is recommendable as a consequence (and costs only little more).
- Opferschutz : coverage for legal advice to make your claim at court against known or unknown perpetrators, especially if you are suffering from injuries or even disability as the result of a violent attack. If courts award you a compensation for your injuries or even a disability pension to be paid by the perpetrator(s) and they can’t honor this for lack of money or sufficient insurance coverage, your own insurance pays for you and tripples the monthly pension. Plus your insurance will pay for up to 10 sessions with a psychotherapist for you.
Exclusions: Third party liability insurance DOES NOT COVER car-related accidents. For this kind of loss, automobile insurance must be taken out
If you like to get a good insurance that covers all of the above, contact us HERE for more info or aks directly for quotes&applications