Motor vehicle insurance in Germany: tariffs increased by 20%

Motor vehicle insurance in Germany: tariffs increased by 20%

Car owners in Germany are faced with rising costs for their vehicle insurance. According to the Verivox car insurance index, car insurance has become on average 20 percent more expensive over the last twelve months, which is well above the general inflation rate. New customers who take out new insurance after buying a car have to pay an average of 18 percent more for a liability policy in the mid-price segment than in the previous year. Prices for partially comprehensive and fully comprehensive insurance have also increased by 19 and 21 percent, respectively.

Wolfgang Schütz, managing director of Verivox Insurance Comparison, explains that motor vehicle insurers have increased their tariffs to cover costs, primarily due to rising claims costs. Although the overall inflation rate fell in March, insurers are still struggling with losses. According to the General Association of the German Insurance Industry (GDV), German motor vehicle insurers recorded a deficit of over three billion euros in 2023. For the current year, GDV forecast a further loss of up to two billion euros.

HUK Coburg, as the market leader in car policies, recorded a deficit of over half a billion euros last year alone. Klaus-Jürgen Heitmann, CEO of HUK, has long criticized car manufacturers' above-average price increases for spare parts. In addition to spare parts prices, workshop and other costs have also increased, which has led to further tariff increases at HUK. Verivox estimates that other insurers will also have to increase their premiums in the long term in order to become profitable again. Current developments indicate that car owners in Germany will continue to face rising costs for their vehicle insurance in the future.