How To Car Insurance

Car insurance made simple. We explain everything you need to know about car insurance

5 minute read2020-11-02
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Your car offers you a great level of freedom. You can get behind the wheel for a quick city break, visit your family in the countryside, or buy everything you need for a house party in one go. Your car opens up many opportunities for you and makes life easier.

However, to register your car for driving on the roads, you need third party car insurance. There is good reason as to why this insurance is legally required. In 2019, there were a total of 2,667,863 car accidents in Germany. That is 7,000 collisions every day. This makes it all the more important that your car is insured. And this even applies to occasional drivers, who are on the road with their old banger as well as to those who cover a significant distance every day.

All you need to know: Your ultimate car insurance guide

From partial and fully comprehensive insurance to the Mallorca Policy (driving rented cars abroad) and driver protection, we help you familiarise yourself with everything you need to know as a driver in our guide for car insurance. We answer the following questions:

What is car insurance, and what do I need it for?

Car insurance is mandatory for all car owners in Germany. Without insurance you are not allowed to drive your car. There are different tariffs, which protect you, your car, and third parties. The different tariffs are tiered, covering a wide range of incidents, from damage and consequential damage from accidents and other types of damage. Basic protection, also known as third party car insurance, is mandatory. In addition to this, you can choose the protection levels partial and fully comprehensive.

Third party, partial comprehensive coverage and fully comprehensive coverage: What’s the difference? Which tariff is right for me?

Third party car insurance

Third party car insurance covers the costs that may arise from damage to property and injury to others, if you have a car accident. You are obliged to pay compensation in these cases – not only for the direct damage, but also for consequential damage caused by the accident. This covers both damage to someone else’s vehicle and damage to property. An example of this would be damage you cause if you drive your car into the wall of a building. In the worst case scenario, people can be injured as a result of an accident. The financial consequences you incur are compensated by your third party insurance.

Additionally, third party car insurance always includes what is known as passive legal protection. This protects you in the event that someone unjustifiably demands compensation from you. Your insurance company checks whether the victim's claim is actually justified and genuine. For example, if your car sends a stone flying against the windscreen of a vehicle behind you, you don’t have to pay for the damage. If someone makes this type of claim against you, passive legal protection ensures you can defend yourself.

Partial comprehensive coverage

Comprehensive coverage, both partial and full, is different to third party insurance. It offers additional protection that is optional. Third party coverage is included with both of these tariffs. In general, partial comprehensive coverage covers damage that you did not cause yourself. This could be stones hitting your windscreen while driving, theft, or storm damage.

Is partial comprehensive coverage right for me?

Broadly speaking, partial comprehensive coverage is a good idea if your car is worth more than 4,000 euros. If you are unsure about getting this policy, just ask yourself: What impact would damage or loss of my car have on my financial situation? You must also consider if you can afford the monthly or yearly payments for this type of policy. It all comes down to weighing up the risks and deciding what makes sense financially.

Fully comprehensive coverage

Fully comprehensive coverage offers an even greater level of protection. It also covers damage to your own car – even if you caused the accident yourself. This is especially beneficial if you are driving a very expensive or new car.

Do I need fully comprehensive coverage?

Getting a fully comprehensive coverage policy is normally the best option if you have a new car that is less than three to five years old, or if you drive a particularly valuable car.

It’s also often best practice, and sometimes mandatory, to get fully comprehensive coverage if you lease your car.

How much does car insurance cost?

The price you pay for car insurance varies greatly, depending on how old you are, what model of car you drive, and much more. In this article, we explain in detail what factors influence the price of your car insurance. We also discuss the main factors below.

Car insurance: Bonus-malus classes

Your bonus-malus class (often referred to as SF class in Germany) indicates how many years you have been driving without an accident. The longer you are claim-free, the higher your SF class and the cheaper your insurance. Beginners usually start at SF 0. The highest SF class is 35 with many insurers. If you are in this class, you typically only pay 20 percent of the car insurance premium rate.

In a family, claim-free years can also be passed on. For example, if you take over your grandparents' car and insurance, their claim-free years will be transferred to you. However, the number of years you are claim free cannot be greater than the number of years you’ve had your driving licence for.

Additionally, your SF class only influences the price of third party or fully comprehensive coverage. This system does not exist for partial comprehensive coverage. The reason for this is that the main purpose of partial comprehensive coverage is to protect you from risks such as theft or natural hazards. Your driving history has no impact on these factors.

Car insurance: Deductibles

With partial and fully comprehensive coverage, you can choose a deductible. That means that you pay a certain amount yourself in the event of a claim. By choosing this option, you typically pay a reduced premium. This option is not available for third party car insurance.

Generally, you can choose between a deductible of 150, 300 and sometimes 500 euros. For partial comprehensive coverage, a deductible of 150 euros is recommended. For fully comprehensive coverage, it’s often a good option to pay 300 euro to reduce the overall price.

When and why does the price for car insurance change?

The price of your car insurance may change annually. There are two common reasons for this. Firstly, your insurer may increase the basic premium. You should  always compare your premium with that of the previous year. Alternatively, an insurer may adjust your bonus-malus class. If you get through the year without an accident, your bonus-malus class will be upgraded and your individual premium will be lower. If you had an accident, however, your bonus-malus class will increase and so will your premium. Forget about this though, and leave that to us. At Getsafe, car insurance remains affordable – even after accidents.

Switching car insurance

Many providers frequently change the conditions for car insurance and increase premiums. If the price soars, you can look for other policies – during switcher season in the autumn at the latest. Here, we will explain what you need to consider when switching car insurance  and what you should know about cancelling your old policy.

When can I switch car insurance? What does the 30th of November deadline mean?

Many providers only allow you to cancel your car insurance once a year. If you want to change your insurance, you must observe the notice period with your provider. This is typically one month. The insurance year starts – like the normal calendar year – on the 1st of January. You must cancel your insurance at least one month before the end of the year, i.e. on November 30. This is why this day is also called the cut-off date. If you miss the deadline, your contract will be automatically renewed for another year. This means it can quickly become stressful to change your car insurance.

Special right of termination: Can car insurance be changed during the year? Can I terminate car insurance after the cancellation deadline?

During the year you can cancel your insurance if you either had an accident or if it is foreseeable that your insurance premium will increase in the following year. In both cases, what is known as the special right of termination applies. But you also have to observe a period of notice of four weeks in both cases. After an accident you will receive a notice from your insurer. Once you have received this, the four-week period for your special right of termination begins. In the case of an increase in the premium, it starts when you receive the notification. Submit your cancellation in writing and state the reason for it.

Which documents do I need to switch car insurance?

When switching car insurance, you should have the following documents with you, which can help an insurer calculate the price for your new policy:

  • Your driving licence: This shows an insurer how long you’ve been driving for.
  • Your vehicle registration document: This includes your number plate and other important information about your car (including manufacturer key number HSN, type key number TSN, and vehicle identification number VIN)
  • Your last invoice from your current insurer that shows your bonus-malus class.
  • The mileage of your car, which shows how much you drive per year.
  • The contract number for your current car insurance.

What should I pay particular attention to when searching for car insurance?

If you take out a car insurance policy, there are several factors you should consider. This isn’t always easy, as car insurance is complex. We will explain the potential stumbling blocks and which special features of car insurance you should be aware of. There can be big differences in the different policies.

Car insurance: Insured for a high amount

It’s always important that car insurance doesn’t just pay out, but that it pays out enough. Check that the amount you’re insured for is high enough. A minimal amount of cover is legally required for third party insurance. Every insurance company – whether expensive or cheap – must at least pay up to 7.5 million euros for damage to other people, up to 1.12 million euros for property damage, and up to 50,000 euros for financial losses. That perhaps sounds like a lot. However, if your insurer has to pay for expensive operations, compensation for pain and suffering, and lifelong disability payments after an accident, the amount you’re insured for can quickly run out. It is therefore advisable to agree on a flat-rate cover of at least 100 million euros for third party insurance.

Mallorca cover: Driving abroad

If you need a rental car abroad, your insurance often doesn’t provide the same protection you get in Germany. You may have to take out extra insurance, which can cost a fair amount. Make sure that your car insurance includes what is known as Mallorca Cover. This addition means you’re insured for the same amount as you are in Germany – allowing you to enjoy comprehensive insurance coverage abroad.

Car insurance: Paying monthly vs. annually

Which payment methods are available, depends heavily on the insurance provider. Often, you can choose to pay your premium monthly, annually, or once a quarter. Some insurers also offer a half-yearly payment method. Paying annually is usually the most popular option. If you pay in installments, you often pay about four to ten percent more. Why? Simply because there are statistics that show Drivers who do not pay their insurance premiums annually have more accidents. So you are automatically one of the drivers with a higher risk of accidents and therefore pay more.

Important for partial and fully comprehensive coverage

Car insurance: Garage partner network – yes or no?

Partial and fully comprehensive coverage gives you the garage partner network option. This means that if an accident occurs, the repair will be carried out by a partner garage of your insurer. The great thing is that you can save up to 20 percent on your insurance premium. What's the catch? You will no longer be free to choose your own garage. This can become a problem if you there is a particular garage you trust that isn’t in the partner network or if you have damage that needs special tools to repair. If the garage partner network doesn’t have a huge range of workshops or is not especially established, you may also have to travel further distances for repairs. You should consider this beforehand and decide whether it fits your needs.

Extended coverage for your car: Damage caused by animals of all kinds

Many policies only cover damage caused by certain types of wild animals. This means that your insurance only covers collisions with animals, such as deer or wild boar. The extended wildlife damage cover, on the other hand, also covers damage caused by other animals – for example, if a pheasant, cat, or farm animal runs in front of your car. For pets that can be clearly identified, the owner of the animal pays for the damage caused.

Accidents involving animals are usually covered by partial or fully comprehensive coverage. Third party insurance only covers the costs in cases where your car isn’t damaged. For example, repairing a damaged barrier or the costs for cleaning the road would be covered.

Car insurance: Damage caused by martens

Partial comprehensive coverage usually covers damage caused by marten bites – some providers, however, categorically exclude marten damages. It’s worth noting that often only direct damage caused by martens is covered, but not the much more expensive consequential damages. Replacing a tube or cable that a marten has bitten is no big deal. But often a marten bite, to the cooling hose, for example, goes unnoticed. This can lead to the engine gradually overheating and resulting in engine damage, which can quickly become expensive. Make sure that your partial comprehensive coverage also includes consequential damage caused by marten bites.

Car insurance: waiver of the plea of gross negligence

If you take out a fully comprehensive coverage policy, it should include a "waiver of plea of gross negligence". If you have this, your insurer won’t check whether or not you were guilty of gross negligence in the event of a claim. This is important, as you won’t be held responsible for an accident that you caused, such as if you went through a red light or missed a stop sign.

Are you still looking for the right car insurance for you? Or do you just want to change without any hassle. The Getsafe Car insurance could be exactly what you’re looking for:

    Stay safe!

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    Author: Carina