Car rental abroad: When does a Mallorca policy make sense?

Anyone who causes an accident with a rental car abroad may have to contribute to the compensation themselves. The reason: Car insurance only covers damage up to the sum insured that applies in the respective country - and in many cases this is lower than in Germany. In this case, it may make sense to take out supplementary insurance that closes this difference from the German standard for sums insured: the Mallorca policy. Officially, it is referred to as insurance for the use of third-party vehicles that are subject to insurance.

When does a Mallorca policy make sense?

In Germany, motor vehicle liability insurance usually covers the full extent of damage in the event of an accident. The statutory minimum sums insured in Germany are 7.5 million euros for personal injury and 1.22 million euros for property damage. These standard sums are exceeded by most car insurance contracts. As a rule, insurers offer significantly higher sums insured, for example up to 100 million euros, which is why motorists do not have to worry much about the financial consequences in the event of an accident with their own car.

However, if you are traveling abroad with a rental car, different rules apply. In this case, the insurance cover is generally based on the regulations in the respective country. If you do not inform yourself and protect yourself accordingly, the holiday can be more expensive than expected. On the one hand, the risk of accidents is higher with rental cars abroad: the environment is not familiar, the controls are unfamiliar and the terrain has different requirements. On the other hand, in many other countries, lower legally prescribed sums of cover apply. This makes it likely that you will make your own financial contribution to major damage caused by the rental car.

Table of countries with the lowest minimum amounts of cover

Land	Personal injury in euros	Property damage in euros
Albania	449.600	89.900
Azerbaijan	26.500	2.700
Bosnia and Herzegovina	1.022.600	204.500
North Macedonia	675.000	337.500
Moldova	500.000	100.000
Montenegro	550.000	300.000
Serbia	1.000.000	200.000
Turkey	232.700	9.300

_{Source: Council of Bureaux (as of 2023), amounts rounded}

What rental car drivers need to know

If the locally applicable sum insured is not sufficient to cover the damage incurred, the insured must pay the rest out of his own pocket. Especially when others are harmed and are permanently dependent on treatment and support, this is particularly bad and causes high costs. Abroad, you should not rely solely on the car insurance of the rental car and take out Mallorca cover as additional insurance.

The policy is therefore particularly useful for drivers who already have car insurance and rent a car, motorcycle or motorhome abroad. If you don't own a car, you can include the Mallorca policy in your private liability insurance or take it out separately.

What does the Mallorca policy cover?

The Mallorca policy increases the sum insured by motor vehicle liability insurance for rental cars abroad. In the event of an accident, the insurance pays the difference between the damage and the sum insured.

Suppose you cause property damage of 300,000 euros with your rental car in Turkey. The liability insurance of the car rental company only pays a share of up to 200,000 euros. You will have to pay for the rest of the claims yourself without additional protection.

With a Mallorca policy, the insurer also covers the consequential costs of personal injury, such as transport, treatment and rehabilitation, as well as repairs to third-party vehicles, buildings and objects. Since the policy offers protection within motor vehicle liability, the insurance does not cover damage to your own vehicle or loss due to theft. These risks can be covered with full or partial comprehensive insurance for the rental car.

Where and for how long is the Mallorca policy valid?

Insurance is limited to the entire area of application of the European Union, or to non-geographical areas that belong to the EU. This area is defined differently by insurers: Some only include the EU area, others also non-European areas. For countries such as Russia or Turkey, the question arises as to whether the Asian part is covered by the insurance in addition to the European part. Life partners or spouses are often included in the insurance cover of the Mallorca policy. How long it is valid is also contractually regulated and depends on whether it is included in the car insurance

Is the Mallorca policy included in your own car insurance?

In some tariffs, the Mallorca policy is automatically included in your own car insurance. It can also be integrated into your existing car insurance.

When do I not need a Mallorca policy?

If necessary, the protection of a Mallorca policy may also be included in the car insurance of the rental car or provide sufficient coverage. In any case, you should check the conditions of the rental carefully. It is also important to take the contract documents with you on vacation.

What impact does the Mallorca policy have on the no-claims class?