# Environmental liability in Germany: two claimants, two policies > When oil, solvents or contaminated firefighting water escape from a business, two parties come forward. A neighbour claims damages for a polluted well, and the authority orders the clean up of soil and water. German insurers cover these with two different products, environmental liability (Umwelthaftpflicht) and environmental damage insurance (Umweltschadensversicherung, USV), and many companies only hold one of them. Quelle/Source: https://www.nammert.com/en/insurance-broker-environmental-liability.php Updated: 2026-11-04 ## Is environmental liability insurance compulsory in Germany? No. For particularly hazardous installations in Annex 2, § 19 of the Environmental Liability Act (UmweltHG) provides for financial security, for example through liability insurance. Voluntary is not harmless; operators of Annex 1 installations and those responsible for water pollution under § 89 WHG are liable without fault. Anyone who causes environmental damage through an Annex 1 activity of the Environmental Damage Act (USchadG) must remedy it without fault too; for other occupational activities this applies to protected species and habitats in case of intent or negligence. ## At a glance - **Compulsory?:** No, with financial security provided for only for Annex 2 installations under the UmweltHG - **Two covers:** liability for third party claims, environmental damage insurance for clean up duties owed to the authority - **Legal basis:** Civil Code (BGB), Environmental Liability Act, § 89 WHG, Environmental Damage Act (since 14 November 2007) - **Statutory cap:** EUR 85 million each for bodily injury and for property damage per environmental impact (§ 15 UmweltHG) - **Structure:** separate risk modules per installation or activity, based on the German insurers' association model wording ## Civil claims and public law duties are covered separately Environmental liability insurance works like any liability policy. It pays when a third party claims compensation for harm caused by an environmental impact from your business, and it defends you against unfounded claims. The model wording is built around liability under the Civil Code, the Environmental Liability Act and the Water Resources Act. Typical cases are contaminated wells, damaged crops on neighbouring land or health effects from emissions. The Environmental Damage Act has no injured neighbour. It obliges the person responsible to prevent and remedy damage to soil, water, protected species and natural habitats, even on their own premises and even where nobody owns the resource. Liability insurance generally does not cover this public law duty. That is what environmental damage insurance, known as USV, is for. ## Risk modules: only what is declared is covered German environmental liability cover is assembled from modules. Each installation or activity is listed: facilities holding substances hazardous to water, installations under Annex 1 or 2 of the Environmental Liability Act, other installations requiring a permit, waste water systems, and the planning, installation or servicing of such systems for clients. A tank that has not been declared may well not be insured. For contractors the recourse module matters most. It applies when you work on a client's installation and cause an escape there, for instance while filling or repairing a heating oil tank. Environmental damage insurance follows a similar logic, and the model wording includes a catch all module for other installations and activities. ## Strict liability: fault is not the question Operators of installations listed in Annex 1 of the Environmental Liability Act are liable for damage caused by their environmental impacts even if they did everything right. The cap is EUR 85 million, separately for bodily injury and for property damage from a single impact. Liability for water pollution under § 89 WHG is also strict and has no such cap. Clean up duties under the Environmental Damage Act do not require fault for certain occupational activities either. A permit does not rule out responsibility under the Act, as the Federal Administrative Court held in 2017. A policy that pays for experts, dealings with the authority and remediation keeps that dispute away from your balance sheet. ## What is covered - Third party bodily injury and property damage caused by environmental impacts through soil, air or water - Defence against unfounded claims - Water pollution from facilities with hazardous substances, if the module is agreed - Operator liability for declared installations under Annex 1 or 2 UmweltHG - Escapes while working on clients' installations (recourse module) - Remediation of soil, water, protected species and habitats under the USchadG through environmental damage insurance - Emergency costs to avert imminent damage, depending on the policy ## What is not covered - Intentional environmental damage and deliberate breaches of environmental rules - Installations and activities not listed in the policy, unless a catch all module applies - Contamination caused before the policy started - Damage from normal, intended operation, where the policy wording excludes it - Claims under US or Canadian law, unless specifically agreed ## Who needs it - Businesses with heating oil, diesel or chemical tanks, separators or hazardous goods stores - Operators of installations requiring a permit, for example under the Federal Immission Control Act - Garages, filling stations, electroplating, paint shops and waste management companies - Contractors working on clients' heating, tank or waste water systems - Farms storing fertiliser, slurry or pesticides - Construction firms refuelling machinery on site ## Who does not need it - Pure office and consulting businesses without storage, tanks or work on installations, if the business liability policy includes small quantities ## What it costs Premiums depend less on company size than on installations: which substances, what quantities, above or below ground, how close to groundwater. A small contractor with a recourse module and a chemicals trader with a tank farm are far apart even at the same turnover. **What drives the premium:** - Type and number of installations, substances and quantities stored - Location, for example in a water protection zone - Limits, separately for liability and environmental damage insurance - Modules included and deductible - Work on clients' installations - Condition and inspection of installations, claims history _There are no reliable published benchmarks for this line, so we do not quote sample premiums. Your premium is fixed only in the quote we obtain with your list of installations._ ## The policy levels on the market - **Environmental extension of business liability:** Small quantities of usual operating materials, sometimes a small tank up to a limit. Little or no cover for clean up under the USchadG. Suitable for businesses without their own installations. - **Modular environmental liability plus USV:** Every installation listed, recourse module for client work, environmental damage insurance with its own limit, including your own site. Suitable for most businesses with tanks or stores. - **Standalone environmental policy:** Separate from business liability, with high limits, a catch all module and a clear boundary between policies. For manufacturing, waste management and UmweltHG installations. ## How to recognise a good policy | Criterion | Minimum standard | Strong policy | Why it matters | | --- | --- | --- | --- | | Environmental damage insurance | included for damage beyond your own premises | also covers soil and water on your own or rented site | The authority orders remediation regardless of who owns the land. | | Declared installations | all tanks and installations listed with substances and quantities | plus provisional cover for new installations and a catch all module | What is not in the policy may well not be insured. | | Recourse module | included if you work on others' installations | at the full limit, including planning and maintenance | A contractor filling or repairing a client's tank is liable for any escape. | | Limit of indemnity | same as the business liability limit | separate limits for liability and USV without low sublimits | Groundwater remediation takes years and costs accordingly. | | Gradual pollution | included | included without a special sublimit | Much environmental damage comes from slow leaks, not sudden accidents. | | Run off cover | for damage caused during the policy period | several years after expiry or closure of the business | Soil contamination often surfaces only on sale or demolition. | ## Insurers on the German market Environmental liability and environmental damage insurance are written by the large German commercial insurers, mostly as an extension of business liability and for industry as a separate policy. The list describes the German market; it says nothing about which insurers we work with. - **Allianz**: environmental liability and environmental damage cover for commercial clients - **HDI Global**: industrial insurer of the Talanx group for larger companies - **Zurich**: German entity of the Zurich group, small business and industry - **R+V**: insurer of the German cooperative banks, including agriculture - **VHV**: focus on construction and trades, also sold through brokers - **Haftpflichtkasse**: liability specialist offering environmental damage insurance as its own product - **Mannheimer**: specialist insurer for selected trades, sold through brokers 127 insurers supervised by BaFin, the German regulator, are licensed for this class of insurance. (Allgemeine Haftpflicht). Source: BaFin company database, 2026-09-18; EU insurers without a German office excluded. ## Typical claims and who pays - **Heating oil spills at a client's home** (often five figures, more if groundwater): This is what the recourse module is for. Without it the contractor pays for excavation and disposal. - **Firefighting water reaches a stream** (five to six figures): The authority orders remediation of the stream under the USchadG. Without environmental damage insurance the business pays. - **Neighbour's well smells of solvent** (a few thousand euros to six figures): Claims by the neighbour are the core case for environmental liability, provided the store is listed. - **Oil separator leaked for years** (six figures with excavation): Slow leaks need gradual pollution cover, and remediation of your own soil needs the extended USV. - **Old contamination found on purchase** (can exceed the value of the land): No policy covers damage caused before it started. Only a soil survey before purchase protects you. - **Hydraulic hose bursts on site** (usually four to five figures): Oil on someone else's ground is covered by the environmental module. Registered vehicles fall under motor liability. ## Myth or truth - „Environmental liability insurance also pays for clean up ordered by the authority." ✘ False, it covers third party claims. The public law duty to remedy under the Environmental Damage Act needs environmental damage insurance. - „If I was not at fault, I do not have to pay for environmental damage." ✘ False, operators of Annex 1 installations and those responsible for water pollution under § 89 WHG are liable without fault. - „A tank that is not listed in the policy may not be insured." ✔ True, environmental liability covers declared installations. New ones must be reported, otherwise only a provisional or catch all module can help. - „The Environmental Damage Act protects nature even where nobody owns it." ✔ True, it protects soil, water, protected species and habitats as such. No injured owner is required. - „Liability under the Environmental Liability Act has an upper limit." ✔ True, EUR 85 million each for bodily injury and property damage from one environmental impact. Liability under the Civil Code and the WHG has no such cap. ## Common mistakes - Commissioning a new tank or store without telling the insurer - Assuming liability cover also pays for clean up ordered by the authority - Buying environmental damage insurance without cover for your own site - Working on clients' installations without the recourse module - Moving into a water protection zone without updating the policy - Cancelling the environmental policy on closure although damage may surface later ## FAQ ### What is the difference between Umwelthaftpflicht and Umweltschadensversicherung? Environmental liability pays compensation to third parties, for example a neighbour whose well is polluted. Environmental damage insurance covers the public law duty to remedy soil, water and protected nature under the Environmental Damage Act. One incident can trigger both. ### Does my German business liability policy cover environmental damage? For usual operating materials in small quantities, often yes. Tanks, separators, hazardous stores and permitted installations must be listed explicitly. Clean up under the USchadG is covered only thinly, or not at all, in many business liability extensions. ### What does the Environmental Liability Act say? Operators of installations in Annex 1 are liable without fault for damage caused by environmental impacts, capped at EUR 85 million each for bodily injury and property damage. For particularly hazardous installations in Annex 2, § 19 provides for financial security. ### Who orders remediation under the Environmental Damage Act? The competent environmental authority. It can order prevention and remediation and recover the costs from the person responsible. No injured third party is needed, because the Act protects nature itself. ### Is contamination from before I took over the site covered? No. Policies cover environmental impacts caused during the policy period. If you take over a site, have its condition documented first so that later findings can be attributed to a period. ### I install heating systems. Do I need environmental cover? Yes, with the recourse module. If heating oil escapes while you fill or repair a client's system, your firm is liable. Many trade liability policies offer the module, but not always by default. ### Do I need to read German policy wording? The binding wording is German and the modules are technical. We explain what each module covers in English and check it against your actual installations before you sign. ### Why use a broker in Germany? Because cover depends on the list of installations, and the boundary with business liability easily leaves gaps. We record your installations and activities in full, review liability and USV together and support you if the authority gets in touch. ## 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. You can write in English. https://www.nammert.com/en/insurance-broker-environmental-liability.php#anfrage --- Your broker: Norman Nammert, trading as NAMMERT. Insurance broker licensed under section 34d(1) of the German Trade Regulation Act. Broker register no. D-C08Q-TOSD4-37. NAMMERT Assekuradeur GmbH is a separate company. It does not arrange your contract. NAMMERT Assekuradeur GmbH, Karl-Marx-Straße 4, 15711 Königs Wusterhausen, +49 3375 29 12 77, info@nammert.com. Wikidata: Q141141479.