Unfortunately, it is impossible to predict adverse events and accidents. However, there are many ways of protecting yourself against their consequences. In the following section, we describe the most important kinds of insurance and explain how to obtain such insurance.
Accidents can happen in the blink of an eye – your child kicks a ball through your neighbour’s window, or you break a vase while visiting a friend. In Germany, you are liable in such cases. In other words, you need to pay for the damage. To prevent this from happening, a liability insurance can be useful. Many Germans regard liability insurance as the most useful and important of the optional types of insurance. In the event of a claim, private liability insurance covers the cost of damages up to a specified amount. It also covers your spouse and children. Liability insurance is available starting at less than 100 euros per year.
Vollkasko insurance also covers any damage resulting from an accident – even if you were at fault – as well as damage from vandalism. This is particularly advisable if your vehicle is new, since the cost of damage would be especially high.
Among other things, the cost of comprehensive insurance depends on your deductible, which is the amount you are required to pay out of pocket. For Teilkasko insurance, it is generally about 150 euros; for Vollkasko insurance between 300 and 500 euros.
This insurance covers the contents of your house or flat. For example, it pays if your furniture or clothing is stolen or damaged by fire, storm or water. The cost depends on the size of your home, among other things. It is particularly worthwhile if you keep valuable items in your home.
You are a member of the statutory accident insurance through your employer. This means that you are covered in the event of an accident in the workplace or on your way to work. However, most accidents happen when you are not at work, and this is where private accident insurance can help. While medical treatment is covered by statutory health insurance, private accident insurance can help mitigate financial consequences. Most importantly, private accident insurance covers you if you become disabled as a result of an accident and are no longer able to work. The insurance company pays disability benefits. You can purchase coverage for types of rehabilitation that are not paid for by statutory health insurance.
Germany’s statutory pension insurance is the most important and strongest component of our old-age security system. To maintain your existing standard of living, however, it is advisable to have an additional retirement plan. Since 2002, the government has subsidised such supplementary pensions. The principle is both simple and effective: If you supplement your statutory pension, whether privately or at your workplace, the government will help – by providing subsidies and tax and contribution exemptions.
To insure yourself against risk, you should purchase an insurance policy. The policy stipulates the following:
Before purchasing a policy, make sure to do plenty of research. Talk to your friends and colleagues. You can also consult a professional insurance consultant, but if you do so, make sure that the consultant provides impartial advice. Insurance consultants at the Consumer protection agency can offer further information.
When you have chosen an insurance company, make an appointment for a personal meeting, where you can talk about the details of the policy. It is a good idea to “sleep on it” before signing a contract. If you are not entirely fluent in German, ask a friend or colleague to go with you to the meeting.
The German Social insurance in brief (German, English, Russian, Turkish)