Get car damage paid out: Secure maximum compensation
8 Jun 2025
6
Minutes
Katrin Straub
CEO at nextsure
An accident that wasn't your fault? You don't necessarily have to get your car repaired. Learn how you can get the damage paid out instead and what to consider in doing so.
The topic in brief and concise terms
You have the right to receive a payout for car damage (fictitious invoice) without having to carry out repairs; the payout is usually made net.
An independent expert report serves as the basis for a notional settlement in the event of major damages and protects against unjustified reductions by the insurer.
In the case of fictitious billing, VAT is usually not refunded; special regulations apply to compensation for total losses.
Understanding the Basics of Fictional Billing
In the event of an accident, as the party suffering damage, you have the right to have the repair costs reimbursed by the other party's insurance. The fictional settlement means you can receive the compensation amount without having to carry out repairs. This is enshrined in Paragraph 249 of the German Civil Code (BGB) and gives you the freedom to manage the compensation amount yourself. Approximately one third of all accident damages are settled in this way. This option is particularly attractive if the damage is minor or if you intend to sell the vehicle anyway. The insurance then pays the amount that would have been incurred for professional repairs in a workshop, usually excluding VAT. Correctly reporting the damage is the first step here. The fictional settlement thus offers a flexible alternative to traditional repairs.
Quick Facts: The essentials of payment at a glance
The decision to opt for a payout for car damage involves several key points. Here is a brief summary of the most important aspects for you:
Entitlement Basis: As the injured party, you generally have the right to demand payment of the damage amount instead of repair.
Calculation: The payout is based on an estimate or an expert report.
VAT: As a rule, the damage amount is paid net, i.e., without VAT, since there is no repair invoice showing the tax.
Reductions: Insurers sometimes try to reduce items such as transportation costs or UPE surcharges; attention is required here.
Total Loss: In the case of a total loss, a fictional settlement of repair costs is not possible; the cost of replacement (replacement value minus residual value) is reimbursed.
Comprehensive Insurance: Even for damage via your own comprehensive insurance, a fictional settlement is possible, but it may lead to a downgrade in the no-claims discount class.
These points form the basis for your decision and further actions.
Practical Part: How the Fictional Billing Works Specifically
Imagine another vehicle causes a dent in your three-year-old car. You do not want to have the damage repaired. First, report the damage to the opposing insurance company. For the assessment of the damage, you usually need an expert report, as an estimate is often only sufficient for minor damages up to approximately 750 euros. The expert calculates repair costs of, for example, 1,500 euros net (excluding VAT) and a depreciation of 200 euros. You inform the insurance that you wish to settle fictitiously. Ideally, the insurance company reviews the report and transfers 1,700 euros to you. Ensure that the insurance does not unjustifiably apply hourly rates of an independent workshop when you are entitled to a branded workshop. In the case of a glass damage, the procedure can be similar. This example demonstrates the typical process of a fictitious settlement.
Examples and Comparison: When is it Worth Opting for a Payout?
The fictional settlement often pays off for older vehicles with low residual value or purely cosmetic defects. Suppose your ten-year-old vehicle suffers damage of 2,000 euros according to the assessment (net). The current value of the car is only 3,000 euros. A repair would hardly be economically viable. You receive the 2,000 euros and can decide whether to carry out a cheap partial repair for 500 euros or leave the damage. You therefore have 1,500 euros at your disposal. If you were to repair the damage for 2,000 euros, you would have a repaired car but no additional liquidity. A self-payment form is not necessary here, as the opposing insurance pays. The decision depends on your priorities and the condition of the vehicle.
Here is a direct comparison for clarification:
Option 1: Repair: Costs 2,000 euros, car repaired, no additional liquidity.
Option 2: Fictional settlement: Payout 2,000 euros, car not (or cheaper) repaired, additional liquidity of up to 2,000 euros.
This comparison helps with individual decision-making.
Expert Depth: Legal Aspects and Current Judgments
The foundation of the fictional settlement is Section 249, Paragraph two, Sentence one of the BGB, which establishes the injured party's right to choose. Courts have repeatedly confirmed that the injured party is in control of the restitution process. This means you decide how the damage is repaired. It is important to distinguish between liability damages (opponent pays) and comprehensive damages (own insurance pays). For comprehensive damages, the policy conditions (AKB) may restrict or set conditions for the fictional settlement. Our expert tip: For liability damages, insist on reimbursement of the costs for a brand-affiliated specialist workshop if your vehicle is younger than three years or has been serviced according to the service booklet. Recent judgments often strengthen the rights of the injured against attempts to reduce costs for transport expenses or parts surcharges. These principles can also be relevant in the event of a hail damage. Knowing these details is crucial for fully enforcing your claims.
VAT on fictitious invoicing: What is reimbursed?
A common point of contention is the value-added tax (VAT). In hypothetical settlements, this is usually not reimbursed since it did not actually incur. Therefore, you receive the net amount of the repair costs. An exception may arise if you can prove that you have made a replacement purchase where VAT was incurred. Our expert tip: Do not agree to a net payout too hastily if you plan to have the vehicle repaired (in part) later and VAT will be incurred. In such cases, a subsequent reimbursement of the actually paid VAT may be possible if the repair is demonstrably carried out. The rules regarding VAT are complex; a detailed examination of the individual case is often necessary, similar to the question of when comprehensive insurance does not pay out. Correct handling of VAT is an important factor in hypothetical settlements.
Appraisal vs. Estimate: The right basis for your claim
Two instruments are available for assessing your damage: the cost estimate and the expert report. A cost estimate from a workshop is often sufficient only for minor damages up to an amount of about 750 to 1,000 euros. For more significant damages, or when it comes to commercial depreciation, an independent expert report is essential. The cost of the report must be covered by the opposing insurance in case of liability damage (except for minor damages). Our expert tip: Always choose your own independent expert and do not accept the expert provided by the opposing insurance. A detailed report lists all damage items, including repair methods, replacement part prices, and possible depreciation, which can also be relevant in the case of a marten damage. A solid report is your strongest argument against the insurance.
The following points illustrate the difference:
Cost estimate: Estimation of repair costs, mostly for damages under 1,000 euros.
Expert report: Detailed damage analysis, determination of repair costs, depreciation, residual value, replacement value; necessary for larger damages.
Evidence preservation: A report also serves to preserve evidence of the extent of damage.
Cost coverage for expert: In the case of liability damages (not minor damages), the opposing insurance pays.
Choosing the right instrument secures your claims.
Insurance Cuts: How to Successfully Defend Yourself
Total Loss and Comprehensive Insurance
More useful links
The Federal Statistical Office (Destatis) offers comprehensive statistics on road accidents in Germany.
The German Insurance Association (GDV) provides statistics on road traffic accidents from the German insurance industry.
The Federal Highway Research Institute (BASt) provides information about the GIDAS (German In-Depth Accident Study).
The German Bar Association offers an example of claims for pain and suffering after a traffic accident.
On Laws in the Internet you can find the German Road Traffic Act (StVG).
FAQ
Can the insurance company reject the notional invoicing?
As a claimant in a liability case, you basically have the right to virtual settlement. The insurance company cannot simply refuse this, but will review the amount and may make deductions if necessary. In the case of comprehensive insurance damage, the options depend on your contract.
How long does the payout take with a notional settlement?
The duration of the payout can vary, but is often between four and six weeks after submission of all documents and review by the insurance company.
What happens if I decide to repair the car after receiving a theoretical settlement?
If you decide to carry out repairs on the vehicle after a notional settlement and VAT is incurred, you may be able to have the VAT actually paid refunded by the insurance, provided the repair is verified.
Do I need to hire a lawyer for a fictional billing?
Not mandatory, but in cases of significant damage, complex situations, or when the insurance company makes substantial cuts, a traffic law attorney can be very helpful in fully enforcing your claims. In the event of a non-fault liability damage, the opposing insurance company must cover these costs.
Can I also settle the damage on a notional basis with my fully comprehensive insurance?
Yes, a fictitious billing is also possible with your own fully comprehensive or partially comprehensive insurance. However, be aware of a possible deductible and the downgrading in the no-claims class.
What if the insurance pays less than what is stated in the report?
If the insurance pays less, you should closely examine the reasons for the deductions. Often, there are disputes about hourly rates or material surcharges. Submit a written objection and provide your justification, possibly with legal assistance.
