Choosing the Right Swiss Personal Liability Insurance

Personal liability insurance covers your financial liability for accidental damages to other people’s property, and injuries to other people. Although it is not mandatory, getting it is highly recommended because liability claims can be extremely high – especially if injuries you inflict on other people result in permanent disabilities.

Personal liability insurance also provides a legal service by determining whether or not you are actually legally liable when claims are made against you.

Here, moneyland.ch lists the most important points to consider when choosing personal liability insurance in Switzerland:

1. Is personal liability insurance the same thing as household insurance?

No. Although Swiss insurance companies often bundle personal liability insurance and household insurance, the two have nothing to do with each other. Personal liability insurance covers your legal liability for damages and injuries, and having it is highly recommended. Household insurance covers your personal possessions against damage and loss, and is generally worth getting if you own things and want to insure against these risks. You can find out more about household insurance here.

2. What is covered by personal liability insurance?

This insurance covers many personal financial liabilities to third-parties. Personal liability can be broadly divided into two main categories:

• Legal liability for unintentional injury to other people

• Legal liability for unintentional damage to other people’s property

The first category – accidental injury to other people – is covered by personal liability insurance in almost all cases. Liability coverage for injuries is the most important part of personal liability insurance, because injuries to other people can result in huge liability claims.

The second category – damage to other people’s property – is largely covered, but coverage is more complicated. Whether your liability for damages to third-party property is covered depends on the kind of property in question, and on how the damages occurred. Each personal liability insurance offer has its own terms and conditions which dictate what is and is not covered.

A personal liability insurance policy may cover just one individual, or an entire household.

3. What is not covered?

Other people’s liability for Iinjury to you or damage to your property is not covered. Neither are damages to your property which are caused by accidents, natural hazards, or theft (these can be insured using household insurance). Liability towards other members of your household is generally not covered.

Any damages or injuries which are deliberately inflicted are not covered. Liability resulting from illegal activities is also excluded.

There are certain hazards which may or may not be covered, depending on the specific insurance offer you use. With some policies, you can add optional insurance riders to cover hazards which are not included in the basic insurance. The following hazards may be excluded or require optional riders to insure:

• Damages to third-party personal property while practicing sports.

• Damages to property belonging to your guests.

• Harm to the environment (chemical spills or leaks, for example).

• Damages or injuries to third-parties which occur while practicing extreme sports like go karting, hang gliding, kite surfing, and paragliding.

• Damages to valuables (jewelry, for example), documents, or keys which other people entrust to your care.

• Third-party damages or injuries resulting from piloting model aircraft (including drones).

• Third-party damages or injuries resulting from piloting aircraft or boats and other watercraft for which special insurance is not required.

• Third-party liability resulting from the use of borrowed, rented, or shared vehicles (for liability which is not covered by the vehicle’s third-party liability insurance).

• Damages or injuries to third parties resulting from gun ownership.

• Third-party liability resulting from part-time work and income-generating activities.

• Injuries or damages caused by other people’s children or pets in your care.

If any of these apply to you, you should make sure to choose a personal liability insurance offer and/or optional insurance riders which match your specific needs.

You should also note that even when insurance offers cover these hazards, they may have separate limits on coverage which are much lower than the policy’s sum insured. For example, offers which cover damages to third-party property caused by sports generally limit coverage to 1000 or 2000 francs.

4. Does personal liability insurance cover damages to rented homes?

Yes. Because your rented home is your landlord’s property, you are legally liable to repair or replace things which you damage. Personal liability insurance covers your liability for these damages. This applies both to damages which you choose to repair immediately, and to those which you leave for your landlord to repair when you move out. Personal liability insurance also normally covers the cost of replacing lost house keys for rented homes. You can find detailed information about this in the guide to liability for damages to rented homes in Switzerland.

5. Are pets covered by personal liability insurance?

Injuries to other people’s pets – including pets which are entrusted to your care – is normally covered. Horses are the main exception to this rule. Many policies have the option of adding cover for liability for injury to borrowed or rented horses. Riding competitions and other events are generally excluded, but a few insurers let you add an optional insurance rider which covers these.

Injuries or damages to other people or their property by your pets is generally covered by Swiss personal liability insurance. However, this coverage is limited to animals which are typically kept as pets (cats and dogs, for example). If, for example, your dog attacks and injures someone while on a walk, your liability to that person will generally be covered. Some insurers will even cover the cost of third-party damages or injuries caused by your pets which you cannot legally be held liable for, up to a relatively low limit. 

Damages and injuries to third parties caused by animals that you keep as pets which are generally considered to be dangerous (monkeys, large reptiles, and poisonous animals, for example) are generally excluded. However, a few insurers offer an optional insurance rider with which you can insure yourself as a keeper of these kinds of animals. 

Liability for damages caused by horses you own normally has to be insured separately with an optional horse liability rider. Not all insurers offer this coverage.

Many offers, but not all, also cover liability for damages and injuries caused by your pet while it is being cared for by another person on an unpaid, voluntary basis. Depending on the specific insurance offer, this coverage may include injuries or damages inflicted on the caretaker themselves, and/or injury or damage to third parties other than the caretaker. Liability is not covered when your pet is in the care of paid pet sitters or pet homes.

If you own a pet, it is a good idea to check the coverage for pets when choosing a personal liability insurance.

6. Does personal liability insurance cover children?

Yes. If you have an insurance policy which covers your family, then your children’s legal liability is also covered. Children are only legally liable for their actions from the time they are considered capable of good judgment – generally by the age of seven. Damages or injuries caused by children who are not yet capable of good judgment do not result in legal liability as long as their parents or guardians performed their supervisory duties. Reasonable due diligence on the parents’ part accounts for the fact that the children cannot be supervised all of the time. Nearly all Swiss personal liability insurance offers include some cover for damages caused by children who cannot be held legally liable (typically between 100,000 and 500,000 francs). So if your young child damages a friend's trampoline or scratches a neighbor’s car, for example, you will be able to make it good and get the insurance company to fit the bill.

Other situations may or may not be covered, depending on the offer and available riders. These include:

• Damages and injuries to third parties caused by someone else’s child who is temporarily in your care.

• Injuries to other people’s children who are temporarily in your care, or damage to their property, when you are legally liable.

• Damages and injuries to you by a third party’s children temporarily staying with you.

• Damages and injuries to third parties caused by your kids while they are guests in somebody else’s home.  

• Damages and injuries to the person in whose home your child is a temporary guest.

If you frequently take care of someone else’s kids, or if your kids are often in other people’s care, then getting insurance which covers these situations is important.

7. Are my domestic workers covered by my insurance?

If housekeepers, caretakers, maids, au pairs, and other domestic workers in your direct employ cause accidental damages or injuries to third parties while they are working for you, your liability as a private employer is covered by your personal liability insurance. However, only one insurer (Zurich) covers your own domestic workers’ liability for accidental damages to you or your property.

This does not apply to domestic workers who are not employed directly by you. Liability for injuries or damages caused by self-employed workers and those employed by agencies generally falls on their company.

8. Am I covered against liability claims arising from my work?

If you work for a Swiss employer, liability for injuries or damages which occur on the job generally lies with your employer. Your employer may get commercial general liability insurance to cover these risks.

Personal liability insurance may cover income-generating activities for which you are personally liable. The majority of offers cover legal liability which results from part-time work that generates income. The primary requirements are that the work is done on a freelance basis and the income it generates falls below certain thresholds. Part-time work which is typically covered, or which can be covered using an optional rider, includes the following:

• Babysitter

• Journalist

• Mountain guide

• Nanny

• Photographer

• Ski instructor

• Sports coach

• Tutor

• Writer

Some insurance providers offer optional insurance riders for other occupations, such as hunters, janitors, keepers of livestock, police, teachers, and winegrowers.

If your job or part-time work exposes you to the risk of liability claims, make sure to choose a personal liability insurance which lets you cover these risks.

Personal liability arising from military service, civil service, and participation in fire departments is covered by most policies.

9. Does personal liability insurance cover liability for driving vehicles?

Swiss personal liability insurance covers liability for third-party injuries or damages caused by your driving a (non-motorized) bicycle. It also normally covers third-party liability when you drive a motorized vehicle which is not required to have its own special third-party liability insurance, such as electric bikes with pedal assistance of less than 25 kmph and electric wheelchairs.

Liability for damages or injuries to other people which result from your driving a vehicle which has to have its own third-party liability insurance is not covered by personal liability insurance. Instead, these liability claims are covered by the vehicle’s own mandatory liability insurance (third-party liability car insurance, in the case of cars).

10. Do I need insurance for damages to borrowed vehicles?

Nearly all Swiss personal liability insurance offers give you the option of adding cover for damages to cars or motorcycles which you borrow from other people. Some (but not all) of these riders also cover damages to borrowed boats. This insurance generally covers the insurance deductible for the vehicle’s obligatory third-party liability insurance, as well as for possible comprehensive car insurance and collision car insurance. It also covers liability claims which are not covered by the car’s mandatory liability insurance. Some of these riders also cover the difference if the owner has to pay higher insurance premiums after you cause an accident (for car insurance which uses a bonus-malus system).

It is important to understand that the third-party liability insurance which all cars licensed in Switzerland must have generally provides sufficient liability coverage. So the main benefit of the borrowed car insurance rider is that if you have an accident in a borrowed car, your personal liability insurance will cover the deductible and possible premium hikes. If you frequently borrow cars which have high insurance deductibles, then having this insurance can be beneficial.

Important: Rented cars, including cars from rental agencies, car sharing platforms, direct rentals from private car owners, and courtesy cars from garages are generally excluded. Currently, only Helvetia’s borrowed car rider covers cars which you pay to use.

11. Are damages to people in the same household covered?

If you cause injury to someone who is insured by the same policy as you, your liability insurance will not cover their liability claims. The same is true if you damage property belonging to another person insured by the same policy.

12. How much liability cover do I need?

The maximum coverage is either three, five, 10, or 20 million Swiss francs. Not all insurance companies offer all of these options. As a general rule, the higher the sum insured is, the more you pay for the insurance, so it is worth considering how much you really need. Some factors which determine how much liability insurance you need include:

• Whether or not you own dogs, horses, or other animals which have the potential to cause injury or damage property.

• Whether or not you drive vehicles (including bicycles) which are not covered by special third-party insurance.

• Whether or not you engage in sports, and particularly in skiing or extreme sports – as these have the potential to cause injury or property damage to third parties.

• Whether or not you travel internationally. In some other countries (like the US), legal liability can be extremely high.

• Whether or not your lifestyle puts you in contact with many other people and their property.

If you rarely engage in activities which could result in liability claims, a sum insured of three million francs may be sufficient. Otherwise at least five million francs is recommended. If you travel internationally, and particularly to countries like Canada and the US, you should consider getting a policy with 10 million or 20 million francs of cover.

It is worth noting that the sum insured has a relatively small impact on the cost of insurance. Because liability claims can potentially be very high, it can be worth paying slightly more to get higher coverage.

13. How much does personal liability insurance cost?

Premiums for Swiss personal liability insurance are relatively low. The cheapest basic personal liability insurance for one person, with three million francs of coverage and a 500-franc deductible, costs less than 50 francs per year. Policies with a zero-franc deductible and high coverage (10 million francs) can be found for less than 100 francs per year.

How much you have to pay for insurance depends on a number of factors:

• The sum insured. The more coverage you need, the higher your premium will be.

• The deductible. The lower your insurance deductible is, the more you will pay for the insurance.

• Whether you rent or own your home.

• Whether you are insuring a single person or a family.

• Whether you need additional insurance riders or waivers.

Of these, the deductible and optional riders have the biggest impact on how much you have to pay for this insurance. Many insurers charge renters higher premiums than homeowners because of the risk of damages to rented homes. Families and couples typically pay more than single adults.

14. Which deductible should I choose?

The insurance deductible is the amount you will have to cover out of your own pocket every time you make a claim. For example, if your liability insurance has a 200-franc deductible, then your insurance will only cover the part of the costs which exceeds 200 francs.

Depending on the insurance offer, you can choose an insurance deductible as low as zero francs, or as high as 500 francs. The lower the deductible is, the higher your insurance premium will be. If you expect to make many, smaller claims, then getting the lowest possible deductible generally makes sense. This could be the case if, for example, you have pets or children who frequently cause small damages to other people’s property. On the other hand, if you only need insurance to cover you in the unlikely event of your being hit with big liability claims, then it makes sense to opt for a high deductible in exchange for lower insurance premiums.

One of the most common uses for personal liability insurance in Switzerland is to cover damages to rented homes, and some landlords will only rent you their properties if you have this insurance. It is important to note here that policies may have a separate minimum deductible for rental damages. For example, you may still have a 200-franc deductible for rental damage claims, even if your policy has a zero-franc deductible for other liability claims.

15. What is a gross negligence waiver?

If damages or injuries are caused by gross negligence, the insurance company will only pay out part of the benefit. In a worst-case scenario, you may have to pay hundreds of thousands of Swiss francs out of your own pocket. A gross negligence waiver protects you from this. When you have this protection, the insurance company waives their right to cut insurance benefits. 

Because it can be difficult to prove that an accident was not caused by gross negligence, getting a policy with a gross negligence waiver is worth considering. Some Swiss personal liability insurance offers include this. Others let you add it as an optional insurance rider for an extra fee. There are also offers which do not give you the option of adding a gross negligence waiver.

16. How do I file a claim?

Most Swiss insurance providers now let you file claims online as well as by mail. If your insurance company has branch offices or agents, you have the option of submitting claims through those as well. You simply need to write up a brief explanation of the damage or injury, and the circumstances which led to it. You also have to include copies of liability claims against you, such as bills for damages or court orders.

The insurance company checks the claims to determine whether they are legally sound. If you are not actually legally liable for a damage or injury, the insurance company will inform you of this so that you can refute the claim.

If a claim is legal, and is covered by your insurance, the insurance company will pay out the insurance benefit as per the terms and conditions of your insurance policy. In the standard procedure, the insurance company does not transfer the money directly to the claimant. Instead, the insurance benefit is transferred to your bank account. You are responsible to make sure that the money is used to settle the claim. However, other settlement procedures may be used in some cases.

More on this topic:
Damages to rental homes: Who pays for what?
Courtesy reductions explained
A basic guide to commercial general liability insurance in Switzerland
Household insurance explained