Liability case underinsurance

The Stuttgart Higher Regional Court (OLG) (ruling of 30 March 2011, file number 3 U192/10) sentenced a commercial broker after a claim for seven-figure underinsurance in building insurance.

The minimum content of the advice must be “above all, advice and information on what risks should be covered, how the most effective cover can be achieved and what risk cover is available at what premium level. The obligation to provide advice is accompanied by a duty of inquiry and information on the part of the broker”.

The broker cannot claim that the policyholder (UN) wanted a certain sum insured that was ultimately too low. Rather, he must check this himself, clearly point out the underinsurance to the policyholder and only insure the insufficient sum insured if the UN is informed precisely – and not, for example, erroneously – deliberately insists on the underinsurance. If the broker cannot – as a rule – prove this, he is liable for the underinsurance himself. Even a mere recommendation to the UN that the sum insured should be checked, which the UN does not follow, does not exculpate the broker because of his own breach of duty. So says the OLG Stuttgart.

BGH confirms brokerage duties

The Federal Court of Justice (BGH, ruling of 10 March 2016, file number I ZR 147/14) confirmed the above brokerage obligations and thus rejected the usual questionnaires. The dentist might as well ask, “Which tooth do you want a crown on today?” Brokers who act as intermediaries according to the system “Which rascal would like it?” do not fulfil their duties and are liable for them.


by Dr. Johannes Fiala


by courtesy of (Published in Finanzen Procontra, issue 05/2016, page 63)

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Dr. Johannes Fiala Dr. Johannes Fiala

Dr. Johannes Fiala has been working for more than 25 years as a lawyer and attorney with his own law firm in Munich. He is intensively involved in real estate, financial law, tax and insurance law. The numerous stages of his professional career enable him to provide his clients with comprehensive advice and to act as a lawyer in the event of disputes.
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