What is it?

Business liability insurance, or “Betriebshaftpflichtversicherung” in German, is a critical safety net for businesses against different risks that can lead to legal claims. Whether you’re in the service industry, retail, or manufacturing, a single accident involving a third party could result in substantial legal fees and damages.

Given Germany’s stringent regulations and potential for costly lawsuits, skipping out on this form of insurance is very risky.

What are the benefits?

There are a lot of benefits of a robust business liability insurance plan. Not only does it cover legal defense costs, but it also pays for any claims made against you by a third party. Coverage can include property damage, bodily injuries, and advertising injuries like defamation or copyright infringement. Some policies even offer optional add-ons like cyber liability or employment practices liability.

The devil can lie in the details, so understanding what your policy doesn’t cover is just as important as knowing what it includes.

Some specific benefits of this insurance are:

Third-Party Injuries

• Coverage: Protects against claims arising from bodily injuries to customers, clients, or bystanders caused by your business operations.
• What’s not covered: injuries to employees are generally not covered under this policy; that’s what workers’ compensation is for.

Property Damage

• Coverage: covers the costs of physical damage to third-party property caused by your business activities, e.g. damaging a clients inventory when working there
• What’s not covered: damages to your own business property.

Additional Coverages

Optional add-ons can include cyber liability, product liability, and professional liability among others.

Who is it for?

Essentially, if you’re running a business, you should have business liability insurance.

Whether you’re a freelancer, small business owner, or the CEO of a large corporation, the financial implications of a liability claim can be life changing.

Rates can vary based on industry, the number of employees, and annual revenue, among other factors. High-risk businesses naturally face higher premiums but should consider this an essential cost of doing business.

Did you know?

~ 95%
The estimated percentage of German businesses which have liability insurance [1]