The Ultimate Expat Guide To Car Insurance In Germany

Johnny

Even though Germany has one of the best public transport systems in the world, most Germans own at least one car. As a matter of fact there are currently  48 million cars on the road in Germany – in a country of 83 million people. german autobahn

In part this is a result of rising property prices all over the country and the fact that a lot of Germans seem to be moving further outside the cities and commute to work by car. So if you plan to move to Germany you might want to consider getting a car. Especially if you have easy access to the Autobahn, the German highway system, getting around this way will be fast and much more efficient. 

Another plus is that if you own a car in Germany, traveling around Europe is easy. Depending on where in Germany you live, you’ll be able to drive to France, Italy or Denmark in just a few hours. 

 

Having a car in Germany


If you’re considering having a car in Germany there are a few things you’ll need to do. First you’ll have to make sure you have a valid driver’s licence. Second, you’ll have to find car insurance. And third you’ll have to register your car. 

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Most of these things will require a number of trips to local authorities and an inevitable amount of paperwork. The good news is that at least for parts of the process there are digital providers who can make things easier for you. 

Depending on where you live, it’s unlikely you’ll need a car. Having lived in Frankfurt for over a year now, there is zero need to own a car in this city. It’s so small and there’s so little street parking, it would be a detriment to own a car here. However, if you live outside of the cities or in a smaller village, then it is very much a necessity to get around. Plus Germans are passionate about their cars so you’ll not to stick out!

 

Driving with a foreign licence


When you first move to Germany you’ll be able to keep using your foreign licence for a limited amount of time. If your licence was issued in a EU country (or a country which belongs to the European Economic Area, short EEA) you can keep using it in Germany until it expires. Just remember that you won’t be able to extend your foreign licence in Germany. So if, for example, you have a driver’s licence from Italy and it’s about to expire, you’d have to go back to Italy to renew it (or use an online service if that exists in your home country). Otherwise you’re good to go. With a licence from the EU (or EEA), you also won’t be required to carry a translation with you.

If your driver’s licence was issued in a non-EU country, things will be more complicated. For one thing, depending on where your licence was issued you may need to carry a translation. Check with whoever issued your licence at home before your move. If you need to get your licence translated in Germany, you can contact your local ADAC office. The ADAC is the biggest German automobile club and offers reliable translation services. Typically this will cost you between 45 to 90 Euros and take between 2-4 weeks. 

Also, once you register as a resident (this is called Anmeldung and is done at the local Bürgerbüro) you can only keep using your foreign licence for up to 6 months. After that your licence will no longer be valid. This is important, especially if you rely on your car to get to school or work. Take my word for it: If you get into a traffic stop and your foreign licence is expired, you’ll get into trouble. That’s why it makes sense to start the process of converting your foreign driver’s licence to a German one as soon as you’ve registered as a resident. 

In my experience wait times for appointments are long, especially in bigger cities like Frankfurt and Berlin. Also processing your paperwork can take several weeks to sometimes months, so make sure you file as early as possible. 

 

Converting a Drivers License


To convert your driver’s licence you’ll have to make an appointment at the Führerscheinstelle, your local driver’s licence office. And you’ll need to bring, you guessed it, lots of paperwork. Typically you’ll have to bring a valid ID, a biometric passport picture, your original licence, a translation (again, have this done at the local ADAC) and your Anmeldung, your certification of registration in Germany. Germany drivers license

There may be additional paperwork required, especially if your licence was not issued in one of the countries which have special arrangements with Germany. Canadians and Australians are lucky for example, as are South Africans and Japanese. They, amongst others, belong to the group of countries whose licences can be converted without additional requirements. Germany drivers license

Licences from the US are a mixed bag: Depending on which US state your licence was issued in, you may be required to take additional tests, or even redo your entire licence in Germany. The latter would include mandatory driving lessons, theory classes and tests. You can do all of this through the local Fahrschulen, driving schools whose students typically are a mix of locals about to turn 18 (the legal driving age in Germany) and foreigners who have to redo their licence. It can actually be a fun experience but be aware it is time consuming and also expensive (getting a regular German driver’s licence can cost up to 2.000 Euros, depending on which region you live in and how many lessons you need). Definitely check with the local authorities if your US state is actually on the list of states with additional requirements before signing up for classes. 

 

Understanding and finding car insurance in Germany


There are three types of car insurance in Germany – only one of which is mandatory. Anybody who owns a car in Germany has to have Haftpflichtversicherung, or third-party liability insurance. It primarily covers the victim of an accident (so if you cause an accident it’ll compensate the person you’ve injured or whose car or property you’ve damaged). Not having this type of insurance is actually a criminal offence in Germany. The good thing is that because of this the insurer generally has to accept your application, even if you have a low or no credit score at all (which is often the case for expats who just moved to the country). It’s rare that a German insurance turns you down for this type of coverage. This is different for the two add-on options, called Vollkasko and Teilkasko (fully comprehensive and partial comprehensive coverage). 

Comprehensive insurance in Germany covers damages to your own vehicle. Teilkasko (partial comprehensive) covers damages to your car which are out of your control (e.g. theft, short-circuit damage, natural disasters), while Vollkasko (fully comprehensive) also covers damages to your car you’ve caused yourself. Obviously, the higher the coverage the more expensive your insurance premium becomes. 

There’s also a deductible. Most Germans take out a standard deductible of 150 Euros for partial and 300 Euros for fully comprehensive insurance. Meaning that even if you have Vollkasko and your car gets damaged, you won’t have to pay more than 300 Euros out of pocket. Typically you do have to use one of the workshops listed in your insurance contract. Always best to double check and make sure that at least one of the listed workshops is actually near you, before you sign the contract. This’ll save you from taking expensive cab rides back to your house after dropping off your car. 

 

Schadenfreiheitsklasse (no-claims bonus) in Germany

There is one thing that Germans will happily boast about when it comes to their driving records: Their so-called Schadenfreiheitsklasse (no-claims class). Essentially it’s an insurance bonus you receive when you haven’t made any claims to your insurance. If you’ve had your driver’s licence for less than 3 years you’ll automatically start at the bottom. But the longer you drive accident-free, the higher your Schadenfreiheitsklasse is. This is important because it lowers your third-party liability and the fully comprehensive insurance premium. The way German insurance companies think about it is this: The longer you drive accident-free, the more you prove you’re a responsible driver. And less liability means lower costs in the eyes of the insurance provider.  

 

Finding the best car insurance provider

The most important thing about car insurance in Germany is finding coverage which actually gives you what you want. And let’s face it, everybody’s idea of risk and liability is different. What I consider sufficient coverage may not be anywhere near enough for you, or vice versa. This is why for expats taking out car insurance the most important thing is that they understand exactly what the insurance covers and what not. This can be a problem in Germany, as the market is still heavily geared towards German speakers. 

Your best option is to compare different car insurance providers and figure out which options they actually offer and what they charge for it. 

A great tool I’ve come across is Joonko. They’re a new car insurance comparison platform in Germany and recently launched an English version. It’s very easy to use and asks only a few questions about you and your vehicle. It’s fully digital, which means you’ll be able to do everything online without having to upload or send in any documents. It explains all available options in detail and has lots of information about expats driving in Germany. Also their customer service speaks English.

To me, Joonko is like a start-up style service that seeks to disrupt typical archaic and bureaucratic processes like car insurance. In addition, there are so many non-German speakers in Germany now, that they are seeking to target the expats which is always surprisingly few and far in between. It’s similar to services like Ottonova for health insurance and Wundertax for filing your tax return. All services I very much welcome!

 

Switching car insurance

Most German car owners get very excited in the fall. That’s because it’s switching season. They’ll shop around for the best deals and take advantage of their annual contracts coming to an end so they can change providers. You’ll have to check the cancellation clause in your contract, but most car insurance contracts in Germany end Dec 31 (which means your notice has to be handed in by Nov 30). 

You can also change insurance providers after you’ve had a claim or your premium has been increased. Equally if you change vehicles because you’ve bought a new car or if the type class of your car changes, you have a special cancelation right and can change insurance. 

 

Registering a car in Germany


It doesn’t matter if you bought a brand new car, a used car or even imported a car (make sure you check on tax obligations before you bring a car in from outside the EU) –  you’ll have to register it at the local Kfz-Zulassungsstelle (vehicle registration office). Sometimes you can also get this done at the Bürgerbüro, although not all services might be available there. The German government recently launched an online service called i-Kfz which offers internet-based vehicle registration. While I find the idea helpful in theory, it appears to be at an infant stage at this point. I don’t know anyone who’s been able to successfully use it. Also it can only be used by German citizens since it requires you, amongst other things, to have a German ID card with chip function. I’d always recommend making a personal appearance at the Zulassungsstelle.

Drivers License office in Frankfurt

This is the office in Frankfurt. Its actually not so bad inside.

The place itself is very similar to the DMV in the USA, or the DVLA in the UK. In other words: Not the most pleasant place to hang out. It’s usually very busy (again, make sure you book your appointment well in advance), crowded and staff can be unfriendly. The best thing you can do is to come fully prepared and bring all of the required paperwork. This’ll speed up the process and, most importantly, save you a second trip to the office. 

 

What you’ll need to register your car

First thing you’ll have to bring is your identity card or passport. You’ll also need to bring a SEPA direct debit mandate which allows the authorities to deduct the vehicle tax directly from your bank account. If you register a brand new car, you’ll have to bring the registration certificate (part 1) and the COC papers (certificate of conformity). You’ll also need your electronic insurance confirmation (the eVB number which proves that you took out the mandatory Haftpflichtversicherung). 

If you register a used vehicle, you’ll need all of the above as well as Part 2 of the registration certificate. Also you’ll have to bring proof that you took your car to a main and exhaust emission inspection. The German government is very strict about vehicle safety and concerned about emissions so they’ll make you prove on a regular basis that your car is not a danger to anyone.  In fact if you own a car that’s older than 3 years, you’ll have to get it inspected every 24 months. Germans refer to this as the “TÜV”, even though the TÜV is really only one of several places which offer car inspections (another one is DEKRA). If the TÜV certificate of your used car is still valid, you don’t have to have it retested until it expires but be sure to bring the certificate to the registration office.

By the way, if you import your car from outside the EU you’ll also have to take it to the TÜV for inspection.

The TÜV inspection isn’t cheap: Be prepared to pay between 100 and 200 Euros for a standard inspection. If issues are found during the inspection, your car will “fail the TÜV” and you have one month to fix the issues. Then you’ll have to get it reinspected (which also costs money, but less than the main inspection) and if the car is good to go it’ll receive a special badge (essentially a sticker on your windshield which’ll also tell you when your next inspection is due). 

When you go to your car registration appointment be sure to bring sufficient cash or your EC card. The registration fees aren’t outrageous (you’ll typically pay between 30 and 60 Euros) but they are payable on the spot. 

 

Your licence plates 

You’ll be assigned a licence plate number during the appointment. Usually the place where you get them is around the corner from the Kfz-Zulassungsstelle. You should be able to walk over there after your appointment, order two and then take them back to the registration office. They’ll attach them for you and make sure you’ve got the necessary legal stickers. 

ROWDY IN GERMANY: German License Plates

If you want specific licence plates and they are available, you can usually reserve them online through the website of your local Zulassungsstelle. Definitely pays off to prepare all of this before you go, so you don’t end up spending all day at the place. 

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