Whether you've just arrived in Germany or have been here for years, understanding how car insurance works is essential. It's not just a legal requirement, it's also key to protecting your finances, your vehicle, and your peace of mind.
In this guide, we will walk you through everything you need to know as an international resident in Germany, from mandatory third-party coverage to comprehensive plans, and share practical tips to help you save on your premiums.
Yes. According to German law, Every car in Germany must have at least third-party liability insurance (Haftpflichtversicherung) before it can be driven or even registered.
Without valid insurance:
This regulation is designed to protect all road users and ensure that anyone involved in an accident has access to financial compensation.
Driving uninsured is a serious offence in Germany. Penalties include heavy fines, loss of driving privileges, and even criminal charges. Your car can also be impounded.
| Consequence | Details |
|---|---|
| Heavy fines | You could face penalties of €1,000 or more. |
| Criminal charges | In some cases, this can lead to formal prosecution. |
| Driving ban | You may lose your licence, either temporarily or permanently. |
| Vehicle impoundment | Authorities can seize your car on the spot. |
In short, it's not worth the risk. Always make sure your vehicle is properly insured before driving, not only to stay on the right side of the law but also to protect yourself and others.
Germany offers three main types of car insurance, each with different levels of protection. Choosing the right one depends on your car's value, age, and how much risk you're comfortable with.
This is the minimum legal requirement for all drivers in Germany. It covers damage or injury you cause to others, whether it's to another vehicle, property, or a person. However, it does not cover any damage to your own car. Here's a summary of its coverage:
| What's Covered | What's Not Covered |
|---|---|
| Damage you cause to other vehicles | Your own vehicle damage |
| Injury to other people | Your own injuries |
| Damage to property | Theft of your car |
Teilkasko (or partial coverage) includes everything covered by third-party insurance, plus additional protection against theft, fire, glass damage, animal collisions, and natural events like storms or floods. In short, it adds protection beyond liability.
| What's Covered |
|---|
| Theft |
| Fire |
| Glass damage |
| Animal collisions |
| Natural disasters (storms, floods, hail) |
This option represents a good balance of affordability and coverage, especially for older but still valuable cars.
This is the most extensive coverage available in Germany. Along with all the benefits of Teilkasko, it also covers damage to your own car, even if you're at fault.
| What's Covered |
|---|
| Everything in Teilkasko |
| Damage to your own car (even if at fault) |
| Vandalism |
| Hit-and-run incidents |
This type of insurance is typically recommended for new or high-value vehicles where repair costs can be significant.
The EVB (Elektronische Versicherungsbestätigung) is a digital code issued by your insurance provider. This number confirms you have valid car insurance and will be required when registering your vehicle at the Zulassungsstelle (vehicle registration office).
You can request your EVB code online or over the phone once you finalize your insurance plan. The code is sent immediately and is valid for up to 3 months. These are the simple steps you have to follow:
1. Choose your insurance provider
2. Request the EVB code (online, by phone, or through an advisor)
3. Receive the code immediately via email or SMS
4. Present it when registering your vehicle
Several factors determine your car insurance costs:
Germany uses a bonus system that rewards accident-free years with reduced premiums. The more accident-free years you have, the lower your rate. Transferring an existing no-claims record from abroad can significantly reduce your costs.
| Years Without Claims | Discount Level |
|---|---|
| 0 years | 100% of base premium |
| 1–2 years | ~80–90% |
| 10+ years | ~30–40% |
| 20+ years | As low as 20% |
If you've held a license for less than three years, you're automatically placed at level 0 (100% premium). After three years of safe driving, you advance to level ½, and then to level 1, reducing your costs annually.
| Licence Duration | Starting Level |
|---|---|
| Less than 3 years | SF0 (100% premium) |
| 3+ years | SF½, then SF1 |
| Each claim-free year | Advance one level |
Newer or high-performance vehicles typically mean higher premiums. Conversely, older, low-risk cars cost less to insure.
| Factor | Effect on Premium |
|---|---|
| New/high-value car | Higher premiums |
| Older/lower-value car | Lower premiums |
| High-performance models | Higher premiums |
| Common, easy-to-repair models | Lower premiums |
Where you live can make a real difference. In busy cities like Berlin, Munich or Frankfurt, insurance tends to cost more because the risks (like theft, accidents, or even tricky weather) are higher. Out in the countryside, premiums are usually lower. Your local area's theft rates, accident statistics and weather risks play a big role in what you pay.
| Area Type | Effect |
|---|---|
| Urban (high traffic/theft) | Higher premiums |
| Rural (lower risk) | Lower premiums |
If you've built up an accident-free record abroad, you may be able to transfer it to your German car insurance, helping you secure a lower premium right from the start. Many insurers in Germany recognize no-claim bonuses from countries such as EU member states, the USA, Canada, Australia, and Japan. In some cases, insurers may also consider records from Russia and certain Eastern European countries, though this is typically subject to individual review. It's always best to check with your insurer in advance to confirm which countries they accept.
1. Send your documents to your new German insurer.
2. They will review your driving history.
3. You'll be placed in the right Schadenfreiheitsklasse (SF class), your accident-free record will work in your favor.
This can save you 20–50% or more on your starting premium.
A few smart choices can make a big difference on your premium (sometimes cutting it by nearly half). Here what we recommend:
| Strategy | Potential Savings |
|---|---|
| Transfer your no-claims bonus (accident-free record) | 20–50% |
| Choose a lower-risk vehicle | 10–30% |
| Opt for a higher deductible | 5–15% |
| Pay annually instead of monthly | 5–10% |
| Skip unnecessary add-ons | Varies |
| Compare multiple quotes | Varies |
Premiums typically range from €500 to €3,000 per year depending on:
Look out for additional charges like administrative fees, monthly payment surcharges, and deductibles that may apply when filing a claim.
Car insurance is essential for protecting yourself, your vehicle, and your finances in Germany. Understanding the system helps you make informed choices and avoid overpaying.
At Stay, we help international residents find the right car insurance at competitive rates, with clear explanations in English every step of the way.
If you'd like personalised guidance, we're here to help.