Liability, contents and legal expenses insurance

• Health insurance is compulsory for everyone living in Germany (see the guide on health insurance). Long-term care insurance comes with it.
• Motor vehicle liability insurance (Kfz-Haftpflichtversicherung) is compulsory for every keeper of a car or motorcycle registered in Germany. You cannot register a vehicle without proof of insurance, which the insurer provides as an electronic confirmation number (eVB-Nummer). Comprehensive cover (Teilkasko, Vollkasko) is optional.
• Dog liability insurance (Hundehalterhaftpflicht) is compulsory in some federal states, in some only for certain dogs. Check the rules of your state; for Berlin see the guide on pets in Berlin.
• Personal liability, contents and legal expenses insurance are not compulsory for private individuals, although personal liability insurance is strongly recommended.

What it covers: damage you negligently cause to other people in everyday life, for example knocking over a friend's laptop, causing an accident as a cyclist or pedestrian, a water leak from your washing machine that damages the flat below, or injuring someone during sports. It also defends you if someone makes an unjustified claim.

What it does not cover: damage you cause intentionally, damage to your own property, damage from driving a car (that is car insurance), professional or business activities, and damage caused by dogs and horses, which need separate animal liability insurance. Cats and small pets are usually covered.

What to look for, based on the Verbraucherzentrale's recommendations:

• A coverage sum (Deckungssumme) of at least 10 million euros for personal injury, property and financial loss; 50 or 100 million euros usually costs only a little more.
• Damage to rented property (Mietsachschäden), important for tenants, for example damage to the flat's fixtures, with at least 500,000 euros.
• Loss of keys (Schlüsselverlust), including keys to a shared building's central locking system and, if relevant, work keys.
• Damage while doing someone a favour (Gefälligkeitsschäden), for example when helping a friend move.
• Children under seven (deliktunfähige Kinder): by law, young children are often not liable themselves, so a good policy pays anyway if your child damages someone's property.
• Default cover (Forderungsausfalldeckung): pays you if someone else damages your property and cannot pay.

Single or family policy: a family policy usually covers your spouse or partner and children until the end of their first education or training and is often cheaper than two single policies. Paying annually is usually cheaper than paying monthly.

Covers your belongings at home (furniture, clothes, electronics) against fire, burglary, robbery, vandalism after a break-in, tap water damage, and storm and hail. It does not cover simple theft without a break-in, or flooding and heavy rain unless you add natural hazards cover (Elementarschadenversicherung). Bicycle theft is usually an add-on.

The sum insured should match the replacement value of everything you own. If it is too low, the insurer pays only proportionally (Unterversicherung). Many insurers waive this if you insure a set amount per square metre of living space, often 650 euros per square metre.

Whether you need it depends on what your belongings are worth and whether you could replace them from savings. It is not required for renting a flat.

Pays lawyers' and court fees in legal disputes, in modules you choose: private, employment, traffic and housing/rental. Points to know:

• Most insurers have a waiting period of three months (some six) before cover starts for most areas, and disputes that began before you signed are never covered.
• The Verbraucherzentrale considers it not essential for everyone and recommends deciding module by module.
• Alternatives exist: trade unions offer legal support to members in employment matters, tenants' associations (Mietervereine) advise their members in rental disputes, and people who cannot afford a lawyer can apply for state-funded legal advice outside court (Beratungshilfe). See the guides on legal help and tenant rights in Berlin.

• Compare the conditions (Versicherungsbedingungen), not only the price. Independent comparisons by consumer organisations and the advice of a Verbraucherzentrale help; online comparison portals and brokers are commercial services.
• Check the minimum contract length and notice period. Contracts are commonly renewed automatically each year and can be cancelled with three months' notice before the end of the insurance year; after a claim or a premium increase you often have a special right to cancel.
• Answer the insurer's application questions truthfully and completely.
• Keep the policy documents (Versicherungsschein) and the insurer's claims phone number or app handy.

• Report the damage to your insurer promptly, in writing or in the app, with photos and a description.
• Do not pay the other person or admit liability yourself before the insurer has checked the claim. The Verbraucherzentrale warns that paying first can lead the insurer to refuse.
• For car accidents, report to your car insurer without delay and do not acknowledge fault at the scene.