German government drafts mandatory coverage for natural disaster damage

Justice Minister Stefanie Hubig and Finance Minister Lars Klingbeil presented a legislative concept that would make it compulsory for newly issued residential building insurance to cover elementar hazards such as floods and severe rain. The plan would also require insurers to add this coverage to existing policies, with automatic extension after one year if owners fail to select a suitable offer. To keep premiums affordable, the draft suggests a lower-cost minimum insurance option, though owners would bear a larger share of any loss under that tier.

The government intends to examine a possible ban on landlords shifting the cost of extreme-weather protection to tenants. The initiative follows the 2021 Ahrtal flood, which highlighted the low uptake of dedicated natural-disaster insurance across Germany.