The word "liability' and the financial consequences entailed concern each of us. Everyone can have a bad day, be in a hurry, tired or simply stressed out. In these situations, we lack concentration, hence a mishap will happen quicker than expected and who, in a quiet moment, has not looked back and thought about an event that could have gone awfully wrong, hence how lucky we were. Just one small moment of negligence or carelessness can result in huge consequences costing a lot of money, unfortunately sometimes more than one can afford. Private liability insurance protects you against such financial catastrophes.
Insured is your legal liability for compensation in accordance with the German Civil Code §823 BGB should you cause any kind of financial loss to a Third Party. This can be in form of injury to a person, damage to property or financial loss (pecuniary loss) and regardless of whether the incident happened as a result of pure intent or gross-negligence on behalf of the insured.
If the Third Party's claim for indemnification is justifiable, the insurance will take care of any demand and arrange for a quick and unbureaucratic payment within your contract's scope of coverage. All compensation demands will be dealt with up to the full amount of the agreed insured sums, ranging between 1 and 50 Million Euros lump-sum, generally up to twice the amount per insurance year.
The following are examples of insured group of people.
- a pedestrian or cyclist in road traffic
- supervising children
- practicing a sport
- a tenant of an apartment or single- / muliti-family house (also granny-flats)
- the owner of one or more apartments / properties (also abroad)
- the owner of small pets (e.g. cats, hamster, rabbit, etc. Dogs & horses are excluded!)
The claimant might try to demand too much money or claim for unjustified damages, which you are legally not liable for. On reporting the claim your insurer steps in between you and the claimant and will enforce your rights, turning down any wrongful claims without any kind of expenses for you.
Damages to a person can be:
- Expenses for medical treatment
- Loss of earnings
- Compensation due to pain and suffering
Material damages can include:
- Cost of repairs
- Replacement costs
- Loss of usage
- Missed profit
Pecuniary Losses are split in:
- Unreal Pecuniary Loss can be
- Loss of earnings
- Repair costs
- Replacement value
- Real Pecuniary Losses effect the financial assets directly
- False alarm (e.g. by calling the police or fire brigade)
- False parking (e.g. you block somebody's driveway and they miss a business appointment)
Unless a policy has determined differently the following are commonly excluded from a German Private Liability insurance.
- Deliberate induced damages
- Knowledge of a faulty or damaged products, works or other merits
- Claims between the policy holder(s) and insured persons, between the insured persons and between umpteen policy holders, all of the same contract.
This also applies to the above-mentioned persons relatives living in the same household
- Items subject to: Leasing, Lease, Loan, prohibited self-given authority or a special custody agreement
- Damages caused by produced or supplied products, works or other merits
- Gene technology
- Privacy- and Copyright Infringement
- Hostility, Harassment, Disturbance or any other Discrimination
- Transmitted Illnesses
- Subsidences, Landslide, Floods
- Rays (e.g. Nuclear radiation, X-Rays, Gamma radiation)
- Motor vehicles & trailers
- Unusual and dangerous employments
- Responsible activties in associations of all kinds