Politics · Germany · 3 hrs ago
Germany proposes mandatory natural-disaster cover for home insurance
Germany’s justice and finance ministers have proposed wider home insurance cover for damage caused by natural disasters.
The plan would require new and existing policies to cover floods and heavy rain, which are not routinely covered now.
For existing policies, the protection would be added automatically after a year if the owner does not respond to an insurer’s offer.
Under the proposal, owners would pay no more than €20,000 themselves for a claim, while a cheaper, more limited policy with a higher owner contribution is also being considered.
The ministers want to keep cover affordable and are examining whether landlords could be barred from passing its cost on to tenants.
Only 59% of German homes have this protection, and the government says extreme natural events cause an average of €2 billion in insured damage each year.
The proposal will be discussed with states, property owners, tenants and insurers before the government proceeds with a bill.
Germany’s government has proposed extending natural-disaster cover to new and existing home insurance policies.
The proposal would cover damage from events including floods and heavy rain.
Owners would pay up to €20,000 themselves for a claim under the proposed standard cover.
The government is also considering a cheaper minimum policy, with owners paying up to €100,000 of costs.
The proposal would prevent landlords from passing the cost of this cover on to tenants.
- Who
- Justice Minister Stefanie Hubig and Finance Minister Lars Klingbeil have drawn up the proposal.
- What
- The proposal would require home insurance policies to cover natural-disaster damage.
- When
- Not stated
- Where
- Germany
- Why
- The government wants to improve financial protection after natural disasters and reduce reliance on state funds.
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- Standard cover
- New and existing home insurance policies would cover natural-disaster damage
- Owner contribution
- Up to €20,000 under the proposed standard cover
- Minimum policy
- Owners could pay up to €100,000 of costs
- Insured homes
- 59 percent of German residential buildings have cover for these risks
- Annual insured damage
- An average of €2 billion from extreme natural events in Germany
What people are saying
Floods and heavy rain can destroy in a few minutes what has been built up over years.
We therefore need comprehensive insurance cover for natural-disaster damage.
Financial protection must not depend on whether politicians open the public purse in an individual case.