# Commercial buildings insurance in Germany: cover for the property you own > If your company owns its premises in Germany, or you invest in a commercial property, the building needs its own insurance. German buildings cover is based on rebuilding cost, not market value, and it treats a change of use by a tenant as a change of risk you must report. Flood is an optional extra. Quelle/Source: https://www.nammert.com/en/insurance-broker-commercial-buildings.php Updated: 2026-09-18 ## Do I need buildings insurance for a commercial property in Germany? There is no legal obligation, but any bank financing the purchase will require fire insurance and register its interest with the insurer. Without cover, the owner pays for demolition, rebuilding and lost rent after a fire. Tenants insure only their own contents, so if you own the building, nobody else covers it. ## At a glance - **Mandatory?:** No, but lenders require fire cover - **Standard perils:** Fire, water from pipes, storm and hail - **Basis of value:** Rebuilding cost today (Neuwert), not market price - **Key extension:** Loss of rent for let space (Mietausfall) - **Flood:** Only with natural hazards cover (Elementar) ## Market value is the wrong starting point Investors from the UK or US often use the purchase price as a guide. In Germany the sum insured reflects what it costs to rebuild a comparable building today, including demolition, planning and current building regulations, but excluding land. A cheap warehouse in a weak market can cost far more to rebuild than it cost to buy. If the sum is too low, § 75 of the Insurance Contract Act reduces every claim in proportion. Some insurers offer indexed rebuilding value based on the 1914 value (Wert 1914) for smaller buildings, which adjusts automatically to construction prices. For larger properties a professional valuation linked to an underinsurance waiver is the safer route. ## Your tenants change your risk Premiums depend on the most hazardous use in the building. If an office tenant leaves and a joinery or restaurant moves in, the fire risk rises. German law treats that as an increase in risk (§ 23 VVG) which the owner must report. Keeping quiet can reduce or remove the claim payment. Vacancy and major refurbishment also need to be reported. Empty buildings attract arson and vandalism, and a water leak can go unnoticed for weeks. During construction work, a separate contractors' all risks policy is usually needed. ## Loss of rent and extra costs Loss of rent cover pays the rent tenants no longer owe while the space is unusable, or the rental value if you use the building yourself. Twelve months is common, better policies offer 24, which matters because rebuilding with permits often takes longer than a year. Look also at cover for extra costs caused by authorities, such as new fire safety or energy requirements that apply to a rebuild. These are often limited or excluded in basic wordings. ## What is covered - The building with permanently installed fixtures and building services - Fire, lightning, explosion and aircraft impact - Water escaping from pipes, frost and pipe bursts - Storm (wind force 8 and above) and hail - Clean-up, demolition and disposal costs - Loss of rent or rental value, usually up to twelve months - Extra costs from official requirements, depending on the policy - Flood, backflow, landslide and snow load with natural hazards cover ## What is not covered - Contents, stock and tenants' fit-out - Flood and heavy rain without natural hazards cover - Gradual damp, wear and poor maintenance - Losses during unreported vacancy or refurbishment - Groundwater, depending on the wording - Intentional damage ## Who needs it - Companies that own their office, workshop or warehouse - Investors letting commercial space - Owners of mixed-use buildings with shops and flats - Anyone whose lender requires fire insurance ## Who can do without - Tenants of commercial space, who insure their contents instead ## What it costs The premium is a rate applied to the sum insured. Use, construction and fire protection move it most, then location. There are no reliable published price ranges for commercial buildings in Germany. **What drives the premium:** - Use by owner and tenants - Construction: masonry, steel hall, timber, combustible insulation - Sum insured and valuation basis - Location: storm, hail and flood exposure - Fire protection: compartments, detection, sprinklers - Age of pipes and building services - Deductible and claims history _We do not publish typical prices, as properties differ too much. Your premium is known once we have a quote._ ## The policy levels on the market - **Fire only:** Fire, lightning and explosion. Often the minimum a lender requires, but water and storm stay uninsured. - **Combined buildings policy:** Fire, water, storm and hail with loss of rent and cost extensions. The standard choice for most owners. - **All risks with natural hazards:** Everything not excluded, plus flood and similar perils, higher limits and loss of rent up to 24 months. ## How to recognise a good policy | Criterion | Minimum standard | Strong policy | Why it matters | | --- | --- | --- | --- | | Underinsurance waiver | none | waiver after valuation or indexed rebuilding value | Construction costs rise faster than owners update sums. | | Loss of rent | 6 months | 24 months, including commercial tenants | Permits and rebuilding often take more than a year. | | Official requirements | excluded | included with its own limit | A rebuild must meet today's regulations, which costs more. | | Change of tenant | report before move-in | provisional cover with later notification | Owners often learn late what a tenant actually does. | | Gross negligence | payment may be reduced | no reduction up to the sum insured | Forgetting to drain pipes in an empty unit is a classic case. | | Natural hazards | not included | included with a reasonable deductible | Heavy rain causes losses far from any river. | ## Insurers on the German market Commercial buildings in Germany are insured by the large property insurers and by regional public insurers. Larger properties are often shared between several insurers. This list is a market overview. - **Allianz**: commercial property through agents and brokers - **AXA**: commercial buildings and property portfolios - **HDI**: Talanx group, commercial customers - **R+V**: cooperative banking group, mid-sized firms - **Zurich**: commercial and industrial risks, mainly brokers - **Provinzial**: regional public insurer - **Alte Leipziger**: broker distribution - **Württembergische**: part of the W&W group 155 insurers supervised by BaFin, the German regulator, are licensed for this class of insurance. (Feuer, Sturm, Hagel-, Frost- und sonstige Sachschäden). Source: BaFin company database, retrieved 2026-09-18. Insurers from other EU countries selling through a branch or without a German office are not included. ## Typical claims and who pays - **Storm strips the warehouse roof** (around €20,000 to €150,000): Storm from force 8 is part of standard German building cover, including rain that comes through the damaged roof. - **New restaurant tenant starts a fire** (six figures up to total loss): An unreported change of use is an increase in risk. Better wordings include automatic cover and let you report afterwards. - **Rebuild must meet new energy rules** (five to six figures, depending on the rules): Extra costs demanded by the authorities are excluded in basic wordings. Strong policies give them their own sum. - **Tenant stops paying rent after fire** (up to 24 months of rent): Basic cover pays six to twelve months. Rebuilding with permits in Germany often takes longer, which is why 24 months matters. - **Snow load caves in the roof** (five to six figures): In Germany snow load is a natural hazard, not storm. It needs the Elementar add-on. - **Leaking gutter soaks a wall for years** (around €5,000 to €40,000 repairs): Gradual damp and poor maintenance are never insured. German cover pays for sudden events, not slow decay. ## Myth or truth - „Buildings insurance is compulsory in Germany." ✘ No, there is no general legal duty. In practice every lender requires it and asks the insurer for a Sicherungsschein. - „If you buy a building in Germany, the seller's policy passes to you." ✔ Yes, under § 95 of the Insurance Contract Act the buyer steps into the existing contract. You can cancel it within one month of registration in the land register and choose your own cover. - „A German buildings policy also covers the value of the land." ✘ No, land does not burn. The sum insured covers rebuilding, demolition and fees, which is why it can be far below or above the purchase price. - „When a delivery truck hits your gate, the driver's motor insurance pays first." ✔ Right, the vehicle's liability insurance is responsible. Your own building policy only matters if the driver is unknown and vehicle impact is included. - „Snow crushing the roof counts as storm damage." ✘ No, German wordings treat snow load as a natural hazard. Without the Elementar add-on it is not covered, even far from any river. ## Common mistakes - Using the purchase price as the sum insured - Not reporting a new tenant with a higher fire risk - Leaving a building empty without telling the insurer - Assuming flood is covered as part of storm - Choosing six months of loss of rent for a building that takes two years to rebuild ## FAQ ### Who insures the building, the landlord or the tenant? The owner insures the building. Tenants insure their own contents and fit-out. German commercial leases often allow the landlord to pass the premium on to tenants as a service charge, if the lease says so. ### What is Wert 1914? A German valuation method that expresses the rebuilding cost in 1914 prices and scales it with a construction price index. It keeps the sum insured up to date automatically and is mainly used for residential and smaller commercial buildings. ### Why does my bank want a Sicherungsschein? It is a confirmation from the insurer that the policy exists and that payments after a total loss go to the bank first. The insurer also informs the bank if premiums are unpaid or the policy ends. ### Is a solar installation on the roof covered? Sometimes against fire and storm as part of the building, but not against technical breakdown, theft or lost feed-in income. Larger systems usually get their own solar panel policy. ### Do I have to report vacancy? Yes, if the policy requires it, and most commercial wordings do after a certain period. Vacancy is an increase in risk under German law, and not reporting it can cost you the claim. ### Is flood damage to my building covered? Only with natural hazards cover. Water entering from outside after heavy rain or a river flooding is neither pipe water nor storm under German wordings. ### Can several buildings be insured together? Yes. A blanket clause can balance underinsurance on one building against overinsurance on another. This is useful for companies with several buildings on one site. ### Does buildings insurance cover a broken heating system? Only if an insured peril such as fire or water caused the damage. A breakdown without an external cause is a matter for machinery insurance. ## Legal basis and sources - [Insurance Contract Act (VVG, German)](https://www.gesetze-im-internet.de/vvg_2008/) - [BaFin company database (licensed insurers)](https://portal.mvp.bafin.de/database/InstInfo/) ## Request quotes We obtain quotes and come back with a comparison. Free of charge and without obligation: the insurer pays our commission. You can write in English. https://www.nammert.com/en/insurance-broker-commercial-buildings.php#anfrage --- NAMMERT Assekuradeur GmbH, insurance broker licensed under section 34d(1) of the German Trade Regulation Act, broker register no. D-C08Q-TOSD4-37. For boat and yacht insurance we act as underwriting agency, not as broker. NAMMERT Assekuradeur GmbH, Karl-Marx-Straße 4, 15711 Königs Wusterhausen, +49 3375 29 12 77, info@nammert.com. Wikidata: Q141141479.