Residential building insurance: home insurance in Germany

Updated:
05.10.2026

Wohngebäudeversicherung (buildings insurance) is insurance that protects homeowners against financial losses resulting from damage to or destruction of their residential buildings.

We all live somewhere: some rent, others are owners. In both cases, it is important to protect your home from unforeseen situations. Property insurance is an important type of protection for homeowners in Germany who want to safeguard their property against damage from fire, storms, hail, plumbing accidents and other risks.

Definition and scope of application of Wohngebäudeversicherung

Property insurance usually covers damage to the building and its appurtenant parts, such as foundations, walls, roof, windows and doors.

The main risks covered by this type of insurance include fire, water damage from plumbing, storms (wind force 8 or above) and hail. Additionally, protection against natural disasters (such as floods or earthquakes) can be included.

Benefits of residential property insurance

Protection against financial loss: In the event of damage from insured risks, the insurance company covers the costs of repairing or restoring the building.
Wide choice of cover options: Insured persons can choose various additional options to extend their insurance cover.
Expenses over and above the repairs: Good policies also cover clearance, demolition, temporary accommodation and loss of rental income. But third-party claims against you as the owner are covered not by this policy but by a separate Haus- und Grundbesitzerhaftpflicht (homeowner’s liability insurance).

Disadvantages of residential property insurance

State regulators Wohngebäudeversicherung in Germany is regulated by the Insurance Contract Act (Versicherungsvertragsgesetz, VVG), and insurers are supervised by the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin). This regulatory framework aims to protect consumer rights and ensure the transparency of insurance conditions.

Do I need to insure my property?

Concluding a property insurance contract is important for several reasons; here are the main ones:

Protection against financial loss: Any damage to a building is generally very costly, not to mention complete or partial destruction. Property insurance protects owners from financial losses in the event of an insured event.
Lender requirement: If the property is collateral for a loan or mortgage, lenders often make insurance a condition of the loan to protect their interests.
Legal responsibilities: general obligation to insure a residential building in Germany: no — it is voluntary insurance. As a rule, it becomes compulsory through the loan agreement with the bank in the case of a mortgage. Separately, the law requires proper insurance of the common property in a homeowners’ association (§ 19 para. 2 no. 3 WEG).
Protection of tenants and third parties: Property owners may be liable for damage caused to tenants or third parties in the event of an accident on their property. Such claims are covered not by building insurance but by homeowner’s liability insurance (Haus- und Grundbesitzerhaftpflicht); for an owner-occupied house without tenants, usually by personal liability insurance.

What is included in a Wohngebäudeversicherung policy

Main building:
Includes all essential elements of the building, such as foundations, walls, roof, windows, doors, floors and interior decoration works.
Permanent plant and structures:
It covers permanent fixtures such as plumbing, electrical systems, heating and air conditioning systems.
Attachments and improvements:
Includes any alterations or improvements made to the building that are not part of the original construction.

Additional elements that can be included in the insurance:

Garages and other outbuildings on the plot:
Includes garages, sheds, outbuildings, fences and other permanent structures located on the plot.
Swimming pools and sports facilities:
Includes protection for swimming pools, tennis courts, sports pitches and other similar facilities.
Landscaping elements and decorations:
May include protection for landscape features such as avenues, fountains, sculptures, path and garden lighting, as well as other decorative objects.
Structures and equipment:
Aerials, flagpoles, satellite systems, photovoltaic installations.
Standalone structures:
Provides cover for detached structures such as gazebos, barbecue areas or children’s play areas.

Adding these items to the insurance policy may require clarification and additional costs, but such an extension of cover provides more comprehensive protection against a variety of risks associated with the property and the surrounding plot.

Risks included in property insurance

Fire: covers damage caused by fires in the home or on the property grounds.
Water damage: covers water damage caused by burst pipes. As well as frost damage to sanitary installations and fittings inside buildings.
Damage from natural disasters (storm force winds, hail): includes damage caused by storms (wind force 8 or above) and hail, covering the repair or restoration of damaged parts of the building.

Risks that can be insured additionally:

Natural disasters (such as an earthquake or flood)
It covers damage caused by earthquakes, floods or other natural disasters.
Rainwater damage
Water from leaking downpipes inside a building: for example, in a garage.
Blocked pipes:
Clearing blockages in drainage pipes.
Unlawful actions (break-in, theft):
Includes damage caused as a result of a break-in or theft, such as damage to doors or windows if the perpetrator enters the building or attempts to do so.
Loss of revenue:
Covers the loss of income (rent) if the house becomes uninhabitable or unfit for use.
Removal of fallen trees from insured property:
Covers the cost of removing trees that have fallen (broken or damaged) as a result of lightning or a storm. Trees that are already dead are not covered.

Each of these risks can be added to the standard insurance policy based on the individual needs and risks of the property owner.

Insurance claim payouts

The main payouts made by the insurance company may include the following:

Repair or damage restoration:
The insurance company can make payments for the repair or restoration of property that has been damaged as a result of an insured event. This may include payment for repair work, materials, etc.
Payment of compensation for loss or damage:
In the event of total loss or the need to replace parts of the property, the insurance company may pay compensation based on the replacement value or the current value of the property.
Temporary accommodation expenses:
In some cases, if a residential property becomes uninhabitable due to an insured event, the insurance company may cover the costs of temporary alternative accommodation until the property is repaired or restored.
Coverage of additional expenses:
This may include clean-up costs, temporary removal, the hire of additional equipment and other necessary expenses associated with the restoration of the property.
Loss of revenue:
Covers the loss of income (rent) if the house becomes uninhabitable or unfit for use.

The specific payout terms are defined in individual residential property insurance policies and depend on the type of insurance (e.g. fire, natural disaster, theft, etc.) and the terms of the agreement with the specific insurance company.

Book a free consultation and we will tailor a package to suit your needs.

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Rules for changing an insurance policy upon a change of owner

Option to change insurance policy:
The new owner has the right to choose the insurer and insurance terms in accordance with their needs. They may decide to change the insurer or review the terms of the current policy.
Validity of the old insurance policy:
When the property is sold, the policy passes to the buyer. The buyer can cancel it within a month of being entered in the land register (Grundbuch); the insurer can cancel it with one month’s notice. This way the house stays insured while ownership changes hands.
Notifying the insurer:
The new owner must notify the insurance company of the change in ownership of the property. This enables the insurer to adapt the terms of the policy to the new circumstances and, if necessary, to review the sum insured.

Wohngebäudeversicherung provides property owners in Germany with essential protection against financial losses resulting from various risks. However, it is important to carefully evaluate individual needs and risks in order to choose the optimal insurance cover. It is recommended to carry out a detailed analysis of the insurance conditions and periodically review the insurance policy for relevance to current needs.

We are always ready to provide you with the necessary support in choosing an insurance company and evaluating the terms of your policy.

What is covered and what is not: a risk breakdown

Risk	In basic cover	What is important
Fire	Yes	Fire, direct lightning strike, explosion, aircraft crash, as well as damage from smoke, soot and water used in firefighting
Escape of water	Yes	Water that has escaped from pipes unintentionally: bursts, washing machine hoses, heating, air conditioning, sprinklers, aquariums, water beds. Includes pipes burst by frost inside and outside the building
Storm and hail	Yes	A storm is force 8 or more on the Beaufort scale, which means from 62 km/h. With hail, the wind strength does not matter
Natural phenomena	No, a separate module	Flood, heavy rain, sewer backup, earthquake, ground subsidence, landslide, snow pressure, avalanches, volcanic eruption
Break-in and vandalism	Usually no	Stolen items are a matter for home contents insurance, which usually also pays to repair the flat’s doors, windows and walls after a break-in. Building insurance covers such damage only under a separate clause, usually for shared doors and windows in a block of flats.
Rain through open windows and doors	No	Classic claim rejection: an open loft window during a storm

Regarding loss of rent. If the building is let and has become uninhabitable, good policies reimburse the lost rent — typically up to 12 months. Check this term in the contract: in case of major damage, repairs often take longer.

Index-linked reinstatement value and premium indexation

The policy is usually taken out as a gleitende Neuwertversicherung (index-linked replacement value insurance): the sum insured and the premium are recalculated every year in line with construction prices. This is not an insurer’s trick but protection against underinsurance — the cost of rebuilding a home rises alongside the prices of building materials and labour.

For a sense of scale: the adjustment factor rose by about 15 per cent in January 2023, by 7.5 per cent in January 2024 and, as inflation eased, by only about 2.5 per cent in 2025, then by 4.2 per cent again in 2026. According to official statistics, prices for the construction of new residential buildings in May 2026 were 5.0 per cent higher than a year earlier.

A legal detail that can save you a lot of stress. An increase in the premium due to this indexation does not by itself give you the right to cancel the contract early: cover increases along with the premium. The special right to cancel under Section 40 VVG only arises if the premium is increased over and above the indexation without any improvement in cover — you then have one month from receipt of the notice.

A word on the “1914 sum insured” method: consumer organisations consider it opaque and say it often leads to underinsurance. A more transparent alternative is calculation by floor area, with unlimited cover or with a deliberately generous payout cap.

Natural disasters: module, risk zones and compulsory insurance status

The module can only be added as a whole — it’s usually not possible to select a single hazard from the list. Two conditions that are important to know in advance:

Sewer backflow. Cover may lapse if the house does not have a working non-return valve. The valve must be installed and kept in working order, and the drainage pipes on the property must be kept clear.
Groundwater from below. If the water did not come to the surface, but rose up the basement brickwork, that is not an insured event, even with the module. Cover only applies once the water has reached the surface and entered the building from there.
Earthquake, subsidence and landslide are only covered if they have natural causes. There is no cover for damage caused by human activity – mining or construction work next door.
Snow load: Roof collapse is covered, but snow sliding from trees onto the building is not.

ZÜRS zones: how insurers assess your address

Class	Statistical frequency of flooding
4	at least once every 10 years — the premium is high, often with a large excess, and cover may be refused
3	once every 10–100 years
2	less than once every 100 years
1	according to current data, not affected by large bodies of water

The two high-risk zones account for about 1.5 per cent of buildings; the system database contains geodata for over 22 million addresses. Additionally, a separate classification for heavy rainfall risk has been introduced — it takes into account regional rainfall intensity and where the building sits in the terrain (hilltop, slope, plain, valley or close to a stream), so a house far from rivers can also fall into a higher risk category.

The insurer has the right to refuse coverage in the module even outside the risk zone — for example, if there has already been water in the basement on multiple occasions.

Compulsory natural disaster insurance: where we are now

As of October 2026 there is no law. The coalition agreement records the intention to oblige insurers to offer new building insurance policies only together with this cover and, in time, to extend existing policies. On 23 September 2026, Federal Minister of Justice Stefanie Hubig announced that the key points of the reform (Eckpunkte) are ready and being agreed within the government; according to the GDV, a draft bill (Referentenentwurf) is expected in the first quarter of 2027. The industry association advocates not for a direct obligation, but for the automatic inclusion of cover with the right to actively opt out, plus mandatory prevention and public-private reinsurance for extreme losses.

Today only about 59 per cent of residential buildings are insured against natural hazards such as flooding, although for new policies the share with the add-on is close to 100 per cent. For scale: in 2024 natural hazards caused around €4.4 billion of property damage, and total weather-related losses came to about €5.7 billion.

Practical conclusion: There is no point in waiting for the law. Check whether the module is included in your policy, and if not, request a quote. The surcharge varies enormously, from a few per cent to several times the premium, so it is worth requesting offers from several insurers.

Construction, purchase, sale

Situation	What you need to know
House building	Fire insurance for buildings under construction (Feuerrohbauversicherung) is usually provided free, if the policy subsequently converts to standard building insurance. Theft from the construction site is not covered — for that you need a separate Bauleistungsversicherung (contractors’ all risks insurance)
Buying a house	Insurance transfers to the buyer automatically along with the property. It is the buyer who may terminate the contract — within a month of the purchase, with immediate effect or at the end of the insurance period (§ 96 VVG). The month runs from the entry in the land register
Mortgage	If the bank is entered in the land register, its consent is usually required to cancel the insurance
Excess	The main lever for reducing the premium. A common benchmark is 500 euros when paid annually
Owners’ association	The common property is insured by the community pursuant to a decision made by the owners, at replacement cost (Section 19(2) No. 3 of the German Condominium Act – WEG). This policy usually covers the entire building, including permanently installed fixtures in the flats, but high-value fittings added by an owner must be reported to the insurer separately. Everyone insures their own home contents themselves.

Who pays the premium in a rented flat

Building insurance premium — operating costs that can be passed on to the tenant. This follows directly from § 2 No. 13 BetrKV: operating costs include property and liability insurance, including insurance of the building against fire, storm, water and other natural disasters, glass insurance and building liability insurance. The tenant only pays this premium if the tenancy agreement provides for it.

Hence the practical conclusion for a landlord letting out property: extending cover with a natural disasters module is doubly advantageous — the premium can be passed on to the tenant, but uninsured damage cannot.

And the mirror image for the tenant: building insurance doesn’t cover your belongings. Furniture, appliances, clothing — these are covered by home contents insurance, a separate contract that you enter into yourself.

Responsibilities of the owner

Maintain the building in good condition. Damage from accumulated wear and neglected repairs is not covered by insurance.
Report any increase in risk (§ 23 VVG) – for example, if the building stands empty for a long time or is converted.
Report damage immediately and minimise its extent (§ 82 VVG): shut off the water, seal the damaged roof, preserve damaged parts for inspection.
Document everything: photos before cleaning, invoices for emergency repairs, written correspondence with the insurer.

What else to read

Home contents insurance – items inside the building
Private liability insurance
Glasbruch (Glass Breakage) Insurance
Kaution: rental deposit
Legal expenses insurance

Sources

§ 40 VVG – cancellation if premiums increase: gesetze-im-internet.de
§ 96 VVG – transfer of insurance when selling the property: gesetze-im-internet.de
§ 23 VVG – increase in risk: gesetze-im-internet.de
§ 82 VVG – duty to minimise damage: gesetze-im-internet.de
§ 2 BetrKV – allocable operating costs: gesetze-im-internet.de
§ 19 WEG – insurance of common property: gesetze-im-internet.de
Statistisches Bundesamt – building cost index: destatis.de
GDV – natural hazards and ZÜRS system: gdv.de
Verbraucherzentrale – building insurance and natural disasters: verbraucherzentrale.de
BaFin — insurance supervision: bafin.de

Frequently asked questions (FAQ)

Do you have to insure a house in Germany?

Not by law: Wohngebäudeversicherung (buildings insurance) is voluntary. If you buy with a mortgage, though, the bank will usually make it a condition of the loan. In a WEG (owners’ association) the common property has to be properly insured at rebuild value. There is no compulsory natural hazards cover yet either: the Federal Ministry of Justice has drawn up key points, and a draft bill is expected in early 2027. I wouldn’t wait for the law. Without a policy, a fire or a burst pipe is paid for by the owner.

What does Wohngebäudeversicherung (buildings insurance) cover?

The building itself and everything firmly attached to it: roof, walls, windows, pipes and heating. The basic cover includes fire, escape of water from the plumbing, storms from force 8 on the Beaufort scale, and hail. The insurer pays for repairs and for removing and disposing of debris. If the house has to be demolished, a gleitende Neuwertversicherung (index-linked rebuild value policy) pays for a new building, planning costs included. Flooding, heavy rain and sewer backflow are covered only by the natural hazards module. Furniture and appliances are a matter for Hausratversicherung (home contents insurance).

Which insurance pays if hail damages my house?

Wohngebäudeversicherung (buildings insurance): hail is part of the basic cover, and unlike with storms, wind strength doesn’t matter. The buildings insurer pays for broken roof tiles, windows and shutters; damaged belongings inside are covered by Hausratversicherung (home contents insurance). If hail punches through the roof and rain gets in, that is also covered under the standard model terms. Rain coming in through a window left open is not. Photograph the damage before you clear up and report it to your insurer straight away.

Who pays for buildings insurance if I rent a flat?

The owner takes out the policy, and you contribute through the Nebenkosten (service charges) if your tenancy agreement validly provides for it. The landlord may pass on buildings insurance against fire, storm and water, natural hazards included, as well as glass and building liability insurance. According to the Deutscher Mieterbund (German Tenants’ Association), these policies averaged €0.31 per square metre a month in 2024. They don’t cover your own belongings: for those you need your own Hausratversicherung (home contents insurance).

Do I need buildings insurance if I own a flat?

Usually not. In a WEG (owners’ association) the community insures the building, and the Hausverwaltung (property management company) normally handles the policy. It covers the whole building with everything permanently built in, and your share of the premium is part of the Hausgeld (monthly owners’ charge). Ask for a copy of the policy and check what it says about your flat, including any fit-out you paid for yourself. You insure furniture and appliances yourself through Hausratversicherung (home contents insurance). Letting the flat? You can pass your share on through the Nebenkosten (service charges) if the tenancy agreement says so.

What does the premium for buildings insurance depend on?

On the risk the insurer takes on. The biggest factors are the perils covered, the type of construction (solid masonry, half-timbered or timber), the roofing, the floor area or sum insured, how the building is used and where it stands. Insurers price the natural hazards module by the risk at the address: in an area that floods often it costs much more or isn’t offered at all. A Selbstbeteiligung (excess) lowers the premium. And almost every insurer links the premium to building prices, so it changes every year without you lifting a finger.