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What happens to the building insurance when you buy a house in Germany?

In short

The seller's building insurance (Wohngebäudeversicherung) does not end when you buy. You step into the running contract the day you are entered in the land register (Grundbuch), under section 95 of the Insurance Contract Act (VVG). Section 96 VVG then gives you one month to cancel, either with immediate effect or at the end of the current insurance period.

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What happens to the building insurance when you buy a house in Germany?

What it costs

What the inherited or replacement cover costs afterwards. Guide figures from published German examples for 2026.

Example	Typical range
Detached house, basic cover	from about EUR 200 a year
Ordinary detached house with good cover	about EUR 400 to 600 a year
Older house or exposed location	over EUR 1,000 a year is common
Effect of the index adjustment on 1 January 2026	on a premium of about EUR 600, roughly EUR 18 more a year

Guide values as of September 2026 from publicly quoted German examples. The index adjustment factor for 2026 is 27.63, so the premium rises even if you change nothing. Your premium depends on the year of construction, the building type, the living space and the location; we obtain the exact quote for you. The figures in the worked example are guide values from our quoting practice.

Worked example

Terraced house bought, land register entry on 12 March

How the numbers look if you check the inherited contract and switch within the window.

Entered as owner in the land register	12 March 2026
Deadline for the special cancellation	12 April 2026
Premium of the inherited contract	about EUR 620 a year, no natural hazards cover
New contract with natural hazards and EUR 500 deductible	about EUR 520 to 600 a year
Premium up to the cancellation	owed by the seller, section 96 (3) VVG

You pay about the same or slightly less, and flood, heavy rain and backed up drains are finally included. Guide values from our quoting practice.

The policy passes to you by law

In Germany a building insurance policy is attached to the building, not to the person. When you buy the house, you step into the seller's contract with all its rights and duties. That is section 95 (1) VVG, and it applies even if nobody told you about the policy.

What matters is ownership, not the notary appointment. In Germany, ownership passes only when the land registry (Grundbuchamt) records you as owner. Between signing at the notary and that entry, several months often pass, and during that time the seller is still the policyholder.

The insurer only has to accept you as the new policyholder once it knows about the sale, section 95 (3) VVG. That is why the report is not optional.

Stage	What applies
Purchase contract signed at the notary (Notar)	the seller is still the policyholder, the contract runs on unchanged
Handover and passing of risk (Gefahrübergang)	usually the handover day, but the policy still runs in the seller's name
Entry as owner in the land register (Grundbuch)	you step into the contract, section 95 (1) VVG
Up to one month after that entry	you may cancel, immediately or at the end of the insurance period
After the month has passed	the contract is yours like any other, normal notice periods apply
Cancellation served	the seller still owes the premium, you are not liable for it

Your one month cancellation window

Section 96 (2) VVG gives you a special right of cancellation (Sonderkündigungsrecht). You decide whether the cancellation takes effect at once or at the end of the current insurance period, which is usually the policy year.

The month runs from the day ownership passes, so from the land register entry. If you did not know a policy existed, the month starts only on the day you find out about it.

The insurer has the mirror image of this right: it may cancel with one month's notice, but only within one month of learning about the sale, section 96 (1) VVG. So a quiet handover does not guarantee that the contract stays.

Never cancel before a new policy is confirmed in writing. A single uncovered day means you carry a fire or a burst pipe yourself.

Who pays the premium in the year of purchase

For the insurance period in which you take over, seller and buyer are jointly and severally liable, section 95 (2) VVG. The insurer may ask either of you for the whole amount, whatever you agreed privately.

Put the split in the purchase contract: who pays until handover, who pays after, and how an annual premium already paid is settled between you.

If you cancel under section 96 VVG, the seller remains liable for the premium and you are not, section 96 (3) VVG.

Read the policy before you sign, not after

You inherit the seller's cover, not the cover you would have chosen. Ask for the policy (Versicherungsschein), the terms (Versicherungsbedingungen) and the last premium invoice before the notary appointment.

Three weak points turn up again and again. A sum insured that was never adjusted to today's building costs, which triggers a proportional cut for underinsurance (Unterversicherung). A missing natural hazards module (Elementarschadenversicherung), so flood, heavy rain and backed up drains are not covered. And old terms that exclude drainage pipes on the plot, solar panels or gross negligence (grobe Fahrlässigkeit).

To be fair, the old contract is sometimes the better one. If the house has two water damage claims in five years, or sits in a flood zone, a new policy may be expensive or simply unavailable. Then keeping the inherited cover and improving it is the safer route.

Ask the seller for the claims history of the last five years and for any open claim. An unsettled claim belongs in the purchase contract.

What if the house has no insurance at all

There is no general legal duty in Germany to insure a residential building. With inherited or long empty houses it does happen that no policy is running.

Then you arrange cover yourself, starting no later than the day risk passes to you (Gefahrübergang), which is normally the handover day, not the land register entry. A provisional cover note (vorläufige Deckungszusage) bridges the gap until the policy is issued.

If you plan to renovate, building insurance does not cover the building site. You need construction works insurance (Bauleistungsversicherung) and builder's liability (Bauherrenhaftpflicht) on top.

If the house stands empty after the purchase, report it. Vacancy is an increase in risk (Gefahrerhöhung) and can cut your cover if it is not declared, above all for water damage in winter.

What the lending bank requires

German banks almost always require at least fire cover, usually full building insurance, and have the claim assigned to them or the policy blocked in their favour (Abtretung or Vinkulierung). Without that proof, the loan is often not paid out.

The law backs the bank up as well. If the owner fails to pay a renewal premium, the insurer stays liable towards a mortgage creditor registered in the land register for a further period, section 143 VVG.

You are not tied to the provider your bank suggests. You may choose freely as long as the cover fits and the bank gets its proof. We compare the terms and obtain the quotes for you.

One practical point for newcomers: policy wordings and claim letters are in German, and the German text is what counts in a dispute. Ask us when a clause is unclear before you sign.

Step by step

Ask the seller for the policy, the terms and the last premium invoice before the notary appointment.
Check the sum insured, the sliding new value clause, natural hazards cover and gross negligence.
Note the date of your land register entry and put the one month deadline in your calendar.
Report the change of owner to the insurer in writing without delay, section 97 VVG.
Get a comparison quote and cancel only once the new cover is confirmed in writing.
Send the proof or the assignment to your lending bank before the loan is paid out.

Checklist

Policy, terms and premium invoice requested before the notary appointment
Claims history of the last five years asked for, open claims settled in the purchase contract
Sum insured and sliding new value clause checked
Natural hazards cover for flood, heavy rain and backed up drains included
Date of the land register entry noted, one month deadline in the calendar
Change of owner reported to the insurer in writing
Proof or assignment sent to the lending bank

Common mistakes

Counting the month from the notary appointment instead of the land register entry
Cancelling before the new cover is confirmed and leaving an uninsured gap
Not reporting the change of owner and losing the claim under section 97 VVG
Letting old terms run on and finding out after heavy rain that natural hazards were never included
Agreeing the split of the annual premium with the seller only verbally

Questions and answers

Frequently asked

Does building insurance transfer automatically when I buy a house in Germany?

Yes. Under section 95 (1) VVG you step into the running contract when ownership passes, without signing anything.

When exactly does the one month deadline start?

On the day you are entered as owner in the land register. If you learn about the policy later, the month starts then, section 96 (2) VVG.

Can I cancel immediately or only at the end of the year?

You choose. The cancellation can take effect at once or at the end of the current insurance period, usually the policy year.

Who pays the premium in the year of purchase?

Towards the insurer, seller and buyer are jointly liable, section 95 (2) VVG. Agree the split in the purchase contract.

What if nobody reports the change of owner?

The insurer can be released from paying under section 97 VVG if the loss happens more than a month after the report was due and it would not have made the contract with you.

Must I take the insurance my bank offers?

No. The bank may require proof and an assignment, but it cannot dictate the provider.

Do I need my own policy from the notary appointment onwards?

Not while a policy exists. If there is none, arrange cover from the handover day, because that is when the risk passes to you.

Is it ever better to keep the old contract?

Yes. For houses with a claims history or in flood zones a new policy can be costly or unavailable. Then keeping the inherited cover and improving it is safer.