Essential insurance

Germany is a country of insurance. As a newcomer, you will quickly be offered dozens of policies – by banks, phone shops, online ads and well-meaning colleagues. This guide sorts them into three groups: what is mandatory, what every expat should have, and what only makes sense in certain situations.

The examples below show typical costs from everyday situations. They are rough orders of magnitude – real cases can be cheaper or far more expensive.

Overview: essential insurance for expats in Germany

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Health insurance – mandatory from day one

Everyone who lives in Germany must have health insurance – public (GKV) or private (PKV). Your choice has long-term consequences, especially for your costs and your options later in life. Read our Health Insurance Guide 2027 or compare your costs directly in the public vs. private calculator. Coming to Germany before your job starts? See incoming and travel insurance for your visa.

Personal liability insurance (Privathaftpflicht)

Under German law, you are liable without limit for damage you cause to others – with your entire assets and future income. A moment of inattention on your bike, a water leak in your rented flat or a dropped laptop at a friend’s home can lead to claims in the thousands; serious injuries can run into the millions.

Personal liability insurance pays justified claims and defends you against unjustified ones. Consumer advice centres call it indispensable for everyone. It is one of the cheapest policies in Germany: good contracts often cost around €50 to €110 a year, and a family policy covers your partner and children too.

Everyday examples

Situation	Possible cost
You knock a glass of water over a friend’s laptop	€800 – €2,000
Your washing machine leaks and damages the flat below	€5,000 – €20,000
You lose the key to your office – the whole locking system must be replaced	€3,000 – €30,000
Your child scratches a parked car with a scooter	€500 – €3,000
You cause a bike accident and a pedestrian is seriously injured: hospital, rehabilitation, lost earnings, compensation for pain	€100,000 to several million

Occupational disability insurance (BU)

If illness or an accident stops you from working in your profession, the German state pension pays relatively little – and only after five years of contributions. Occupational disability insurance pays you a monthly income instead. For anyone who lives from their salary, it is one of the most important policies. Premiums depend on your age, health and profession at the start, so it pays to decide early.

Everyday example

Priya, 34, software engineer in Dresden, earns €3,800 net a month. After a burnout she cannot return to her demanding job for years. With only a few years of German contributions, she has no claim to a statutory disability pension yet – and even with a full contribution history, new disability pensions averaged around €1,067 a month in 2025. Her rent, food and savings plan continue. A BU policy with a €2,500 monthly benefit would close most of that gap until she can work again – or until retirement.

Read more: Why moving home is not an income plan.

How much do you need? A good rule of thumb is around 75% of your net income. Move the slider to see your number – and what the state would pay instead.

Household contents insurance (Hausrat)

Household contents insurance covers your belongings – furniture, electronics, clothes, bikes (optional) – against fire, burst pipes, storms and burglary. It pays the replacement value, i.e. what it costs to buy the items new.

It makes sense when replacing everything at once would be a financial problem. If you live in a small furnished flat with few belongings, you may not need it yet. Make sure the sum insured matches the value of your belongings, otherwise the insurer only pays part of the damage.

Everyday examples

Situation	Possible cost
Burglary: laptop, camera, jewellery and a damaged door lock	€3,000 – €8,000
A pipe bursts while you are on holiday – floor, sofa and electronics are ruined	€5,000 – €15,000
Your e-bike is stolen from the locked cellar (with bicycle cover)	€2,000 – €5,000
A kitchen fire destroys the furnishings of a two-room flat	€20,000 – €50,000

Car insurance – mandatory if you own a car

Every car registered in Germany must have liability insurance (Kfz-Haftpflicht). The legal minimum is €7.5 million for personal injury, €1.22 million for property damage and €50,000 for financial losses per claim – we recommend a flat €100 million. Partial or fully comprehensive cover (Teilkasko / Vollkasko) for damage to your own car is optional and worthwhile for newer cars.

Everyday examples

Situation	Possible cost
You misjudge the distance when parking and dent another car	€1,000 – €4,000
Rear-end collision at a traffic light, the other driver needs physiotherapy	€5,000 – €15,000
Serious accident with a lifelong disability of the other party	several million

Dog liability insurance

Dog owners are liable for any damage their dog causes, even without their own fault – and personal liability insurance usually excludes dogs. In seven federal states (Berlin, Bremen, Hamburg, Lower Saxony, Saxony-Anhalt, Schleswig-Holstein and Thuringia), dog liability insurance is mandatory for every dog. In other states, including Saxony, special rules apply to dogs classified as dangerous. We recommend it for every dog owner.

Everyday examples

Situation	Possible cost
Your dog jumps up at a jogger, who falls and breaks a wrist	€5,000 – €20,000
Your dog runs into the road and a cyclist crashes	€10,000 – €100,000+
Your dog chews the wooden floor of your rented flat	€1,000 – €5,000

Legal expenses insurance (Rechtsschutz)

Legal expenses insurance pays lawyer fees, court costs, expert opinions and the other side’s costs if you lose. In Germany it is built from modules – usually three pillars, plus tenancy as an option. You choose the areas that match your life:

The pillars in detail – with example costs

Pillar 1: Private

Disputes in everyday life as a consumer – for example with an online shop, a tradesman, a travel provider or an insurer.

Situation	Possible cost without insurance
A tradesman installs your kitchen badly and refuses to fix it – you sue for €8,000	€3,000 – €6,000 for lawyers and court in the first instance
Your airline refuses compensation for a cancelled flight and you go to court	€500 – €1,500

Pillar 2: Work

Especially important for employees – and for expats whose residence permit depends on their job. At the German labour court, each side pays its own lawyer in the first instance, even if you win.

Situation	Possible cost without insurance
You are dismissed and file a claim (gross salary €5,000 a month)	€2,500 – €4,000 for your own lawyer – even if you win
Your employer issues a poor reference or refuses to pay your bonus	€1,000 – €3,000

Pillar 3: Traffic

Covers you as a driver, cyclist, pedestrian or passenger on public transport.

Situation	Possible cost without insurance
After an accident, the other side disputes who was at fault – you need an expert opinion and a lawyer	€2,000 – €8,000
You want to challenge a speeding fine with a driving ban	€800 – €2,500

Optional: Tenancy

Disputes with your landlord about service charges (Nebenkosten), rent increases, repairs or the return of your deposit – a common topic for expats who move often.

Term life insurance (Risikolebensversicherung)

If someone depends on your income – a partner, children or a bank financing your home – term life insurance pays an agreed sum if you die. It is inexpensive, especially when you are young and healthy, and often required for a mortgage.

Everyday example

Ana and Tomás buy a flat in Leipzig with a €300,000 mortgage; Tomás earns most of the family income. If he dies, Ana would have to pay the loan alone with one salary and two children. A term life policy over €300,000 pays off the mortgage – often for well under €30 a month when you are in your thirties and healthy.

Rent deposit guarantee (Mietkautionsbürgschaft)

German landlords may ask for a deposit of up to three months’ net rent – often several thousand euros right when you move in. With a rent deposit guarantee, an insurer guarantees this amount to your landlord, and you pay a small annual fee instead. Your cash stays available for furniture, your move and your first months in Germany.

Everyday example

Your new flat costs €1,100 net rent a month. The landlord asks for three months’ deposit: €3,300 in cash, due when you sign. With a rent deposit guarantee you keep that money and pay a small annual fee instead – typically a few percent of the deposit amount.

What you usually do not need

Consumer advice centres consider these policies unnecessary for most people:

• Luggage insurance – many items are covered elsewhere, and exclusions are wide.
• Gadget insurance for phones, laptops or glasses – often €8–15 a month for a €1,000 phone, so over a few years you pay the price of a new phone.
• Glass insurance – the damage rarely justifies the premium.
• Funeral expenses insurance – savings or term life insurance do the job better.

Essential insurance for expats – how we help

We check which policies you really need, explain the contracts in English and arrange your cover with Allianz – and if you have a claim, we handle it for you. The first conversation is free.

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Frequently asked questions

Which insurance is mandatory in Germany?

Health insurance is mandatory for everyone living in Germany. Car liability insurance is mandatory for every registered car, and in several federal states dog liability insurance is mandatory for dog owners. Everything else is voluntary.

Is personal liability insurance mandatory in Germany?

No, but it is the most important voluntary insurance. You are liable without limit for damage you cause to others, and good policies cost only around €50 to €110 a year.

Does my insurance from my home country cover me in Germany?

Usually not for long. Policies from abroad often end or lose cover once you move your residence to Germany, and German landlords, employers or authorities may expect a German policy. Check the terms of your existing contracts before you rely on them.

What happens to my German insurance if I leave Germany?

It depends on the policy. Some, like occupational disability insurance, can continue worldwide; others, like household contents or car insurance, end or can be cancelled when you move abroad. We check this with you before you leave.

Can I get my insurance documents in English?

Yes. We explain all contracts and conditions in English, German or Turkish, and help you with every letter from your insurer.