Liability insurance only pays the current value: who covers the rest?
In short
Liability insurance for private persons (Privathaftpflicht) only pays the current value (Zeitwert), as German law only grants the owner that value. As to who covers the rest: usually nobody, the owner bears the gap. Exceptions are policies with a new value clause, for example for items up to two years old and up to EUR 10,000, or the owner's own contents insurance when an insured peril caused the damage.
What new value clauses in German personal liability policies offer and what policies cost, based on published examples.
Example
Typical range
Very good family tariff in a German consumer test, no add ons
from EUR 48 a year, average of all tariffs EUR 99
New value for damage you cause to items up to two years old
up to EUR 10,000 per claim, premium tariff only
Repair instead of write off
up to 130 percent of current value in higher tariffs
As of October 2026, from consumer test results and a tariff description from 2024.
Age limits and caps differ by tariff; the policy terms decide.
The current value in the example is an assumed guide value from our quoting practice.
Worked example
Laptop knocked off the table at a games night
A guest trips over the cable and the host's three year old laptop falls and cannot be repaired.
New price of a comparable model
EUR 1,200
Current value after three years (assumed)
EUR 450
Paid by the guest's liability insurer
EUR 450
Gap to the new price
EUR 750
New value clause applies?
no, the laptop is older than two years
The host receives EUR 450 and bears EUR 750 unless the guest voluntarily adds something.
Why German liability insurance only pays the current value
Under German law, whoever causes damage must restore the situation that would exist without it (section 249 of the Civil Code, BGB). A five year old TV is replaced by the value of a five year old TV, not a new one. Paying the new price would leave the owner better off than before, so courts deduct this gain (Abzug neu für alt, new for old).
Your liability insurer only pays what you legally owe. Unless your policy adds an extra benefit, it cannot pay more than the current value: roughly the new price minus age and wear, often checked against prices for comparable used items.
Who can cover the rest up to the new price
Without a special clause, the owner keeps the difference. Five routes can still close the gap, none of them applies automatically.
Who
When
Limit
Your liability insurer with a new value clause
your policy pays new value for young items
in the example tariff up to EUR 10,000, items up to two years
The owner's liability insurer with a top up benefit
the owner's item was damaged by someone else
only if the owner's own policy provides it, limits per terms
The owner's contents insurance (Hausrat)
fire, tap water, storm or burglary
new value, the insurer then claims from you
You, out of your own pocket
voluntarily, for example among friends
none, but only after the claim is settled
Manufacturer or retailer
item still under warranty
defects only, not accidental damage
Repair is often the better deal
If the item can be repaired, liability insurers generally pay the repair cost as long as it does not clearly exceed the current value. For the owner this is often better than a cash amount, because they get their item back.
Some newer German tariffs explicitly allow repairs up to 130 percent of the current value. For a three year old e-bike worth EUR 1,200 today, that means up to EUR 1,560 for the workshop instead of EUR 1,200 for a write off.
The owner's contents insurance can step in
If water from your washing machine floods the flat below, that is a tap water claim (Leitungswasserschaden) for your neighbour's contents insurance. It pays new value for their furniture and later recovers the money from you or your liability insurer (section 86 VVG). Your neighbour avoids the current value dispute.
This only works for perils covered by contents insurance. If a guest knocks your laptop off the table, that is not a contents claim, so only the guest's liability insurer pays, at current value.
When a new value clause is not worth extra money
These clauses almost always apply only to very young items. Most liability claims involve older things like glasses, phones or furniture, where the clause does not help. Choosing a more expensive tariff just for this clause rarely pays off.
More important are a high cover limit, damage to borrowed and rented items and default cover (Forderungsausfall), which pays you if someone who damages your things cannot pay.
Step by step
Report the damage to your liability insurer straight away and promise nothing.
Collect the receipt, the item's age and photos.
Check whether a repair is possible before replacing.
Look for a new value clause in both policies.
For fire, water or storm damage, involve the owner's contents insurance.
Decide on a voluntary top up only after the claim has been settled.
Checklist
Age and new price of the damaged item known
Repair quote obtained
Own policy checked for a new value clause, age limit and cap
Owner's contents insurance involved if an insured peril applies
No promise to pay before the insurer decides
Common mistakes
Promising the owner the full new price on the spot
Throwing away a repairable item and losing the evidence
Forgetting your own contents insurance after water damage from a neighbour
Assuming a new value clause covers items of any age
Questions and answers
Frequently asked
May I pay the difference myself?
Yes, your cover stays in place.
Wait until your insurer has settled,
otherwise you may pay amounts the insurer would not have accepted.
How do insurers calculate the current value?
They start from the new price and deduct an amount for age, wear and condition.
They often also compare prices for equivalent used items.
Do I have to accept the current value if my item was damaged?
The principle, yes; the amount, not blindly.
Provide the receipt, photos and comparable offers if the figure seems too low.
Does the deduction also apply to clothes and glasses?
Yes.
For glasses that are several years old, often only a small residual value remains.
Does liability insurance pay the full price for a brand new item?
For an item only a few weeks old, the current value is close to the new price.
A new value clause can then close the gap completely.
What about sentimental value?
German liability law generally does not pay for sentimental value.
For pets, vet costs can be reimbursed even beyond the animal's market value.
