Changing the policyholder for car insurance: your comprehensive guide to a smooth transition
18.04.25
5
Minutes
Katrin Straub
Managing Director at nextsure
Changing the policyholder for a car can be necessary for many reasons, whether it’s a sale, a gift or a change in family circumstances. This process often raises questions: What do I need to bear in mind? How does the change affect my premium and no-claims discount? Find out everything you need to know here for a smooth transition.
The topic in brief and concise terms
A change of policyholder for motor insurance requires the insurer’s consent and notification to the insurer; the premium often changes as a result of a reassessment of the risk.
The no-claims discount can, under certain conditions, usually within the family, be transferred, with the recipient’s driving experience limiting the maximum transferable level.
A special right of cancellation often applies in the event of a sale, change of policyholder, premium increase or after a claim, with a notice period of usually one month.
Understanding the basics of changing the policyholder
A change of policyholder in motor insurance means that the person who took out the insurance contract and is responsible for paying the premium changes. This is not the same as a change of vehicle owner, although the two often occur together, for example in the event of a vehicle sale. The new policyholder takes over the rights and obligations under the existing contract or takes out a new one. It is important to report this change to the insurer without delay, often within a week. The cost of a pure policyholder change is usually low, but can amount to up to sixty euros if it is accompanied by a change of vehicle owner and the issue of new licence plates. This step is crucial, as it affects the calculation of the insurance premium, which depends on factors such as the new policyholder’s age and driving experience. Understanding these basics is the first step towards a successful transition.
Practical implementation: step-by-step to the changeover
The process of changing the policyholder for a car insurance policy requires a few concrete steps. First, you must contact your current insurance company and request the change. The new policyholder must provide all relevant information, including personal details and driving licence information. In many cases, especially if there is no change of keeper, a written declaration of consent from the old and new policyholder is required. A practical example: if a child takes over their parents’ car, they can be recorded as the new policyholder even if the vehicle remains registered to the parents; this is called deviating keeper status. The insurer will then adjust the contract and recalculate the premium. Please note that the exact requirements may vary depending on the insurer, so speaking directly with them is always the best approach. Next, we will look at the impact on your no-claims bonus.
No-claims discount: managing transfer and consequences
A key point when changing vehicle policyholder is how the no-claims bonus (SFR) is handled. The good news: the SFR can often be transferred to another person, typically within the family, such as a spouse, children or grandchildren. This usually requires a form for bonus transfer to be submitted to the insurer. It is important that the recipient can only take over as many claim-free years as they could have accumulated themselves since obtaining their driving licence. A new driver with one year of driving experience, for example, cannot fully take over an experienced driver’s SF class 20. The transfer is often subject to conditions, such as the recipient having regularly used the vehicle or living in the same household. Please note that anyone who gives up their SFR loses it irrevocably. A careful review of the transfer options is therefore essential before we turn to the legal framework.
Navigating legal frameworks and special cases
The legal basis for the transfer of rights and obligations when an insured item is sold can be found in Section 95 of the Insurance Contract Act (VVG). This section states that the purchaser assumes the rights and obligations of the insurance contract. A special right of termination exists in several situations, for example in the event of a premium increase without an adjustment in benefits, after a settled claim, or when a vehicle is sold. The notice period for special termination is usually one month after becoming aware of the reason for termination. A special case is the death of the policyholder: The insurance passes to the heirs. If the vehicle was re-registered to an heir during the policyholder’s lifetime, that heir has a special right of termination. It is important to know the difference between policyholder and insured person, as the policyholder is the contractual party with all rights and obligations. These legal aspects are crucial to ensuring the process is handled correctly.
Here are some reasons that can trigger a special right of termination:
Premium increase by the insurer without a corresponding improvement in benefits.
After settlement of the claim by the insurer.
Sale of the vehicle (buyer or seller may terminate).
Change of vehicle keeper, even without a sale (e.g. transfer within the family).
Decommissioning of the vehicle.
The exact terms and deadlines should always be taken from the contractual documents or requested directly from the insurer to ensure that all steps are carried out correctly and no disadvantages arise.
Expert tips for a smooth policyholder change
To make a car insurance policyholder change as smooth as possible, there are a few expert tips. Our expert tip: only cancel your old contract once the new contract is in force and you have received the insurance confirmation (eVB number). This prevents a gap in cover, which in the worst case can lead to the forced immobilisation of the vehicle. Before making a switch, be sure to compare the benefits and rates of different providers. Sometimes it is more cost-effective for the new policyholder to stay with the current provider, especially when it comes to transferring discounts. Document all steps in writing, especially cancellations and agreements on discount transfer. A simple, informal cancellation letter is often sufficient, but it should be sent by recorded delivery so that you have proof. If you are unsure, a consultation such as that offered by nextsure can help you find the best solution for your individual situation and avoid mistakes. Remember that a sample letter for the switch can be helpful. This careful preparation leads to a smooth transition.
Common mistakes and how to avoid them
When changing the policyholder for car insurance, mistakes can easily be made that cost time and money. A common mistake is confusing the policyholder and the vehicle owner; these are two different roles with different responsibilities. Another pitfall is the assumption that the no-claims discount can be transferred automatically and in full to any person whatsoever; there are clear rules and limitations here, especially with regard to the recipient's own driving experience. Many also overlook the cancellation periods, in particular the special right of cancellation, which is often only one month. A critical mistake is using the vehicle without a valid insurance confirmation, which can have serious consequences in the event of an accident. Avoid failing to inform the insurer about the change, as this can lead to problems in claims handling. Providing incomplete or incorrect details of the new policyholder can also lead to delays or incorrect premium classifications. By observing these points, you can ensure a smooth change.
Changing the policyholder often has a direct impact on the amount of motor insurance premium. The premium is recalculated on the basis of various factors relating to the new policyholder. These include age, driving experience (measured in years since obtaining a driving licence), place of residence (regional class) and the transferred or newly assigned no-claims bonus class. If, for example, a young driver with little experience takes out the insurance, the premium usually increases, even if the vehicle remains the same. Even a change in the youngest driver can affect the premium by more than ten per cent. The vehicle’s type class also plays a role, but does not change solely as a result of changing the policyholder. It is therefore advisable to obtain several quotes before making the change in order to assess the financial consequences. Understanding the term policyholder is fundamental here. This calculation is an important step before making the final decision.
The following factors have a significant influence on the new premium:
Age of the new policyholder.
Length of time the new policyholder has held a driving licence.
Transferred or newly assigned no-claims bonus class.
Place of residence and the associated regional class.
Annual mileage.
Occupational group of the new policyholder (some tariffs offer discounts).
Type of vehicle use (private/commercial).
An exact calculation can only be made once the new policyholder has provided all relevant details.
Checklist for changing the policyholder
To ensure nothing is forgotten when changing the policyholder for a vehicle, a structured approach helps. This checklist summarises the most important points to make the process efficient. First, you should clarify the reason for the change (e.g. sale, gift, within the family). Obtain the consent of the current policyholder if this person is not the same as you. Contact the current insurer and ask about the exact procedure and the documents required for the change. Clarify the possibility and conditions for a transfer of the no-claims bonus. Compare quotes if you also want to change insurer – often it is easier to stay with the existing provider if discounts are to be transferred. Take out the new policy and wait for the electronic insurance confirmation (eVB number) before cancelling the old policy. Inform the registration authority about the change if this is not done automatically by the insurer (particularly relevant if the registered keeper is changing at the same time). Keep all documents and correspondence carefully. With this preparation, nothing stands in the way of a successful change.
Conclusion and next steps
A change of policyholder for motor insurance is a multi-step process that runs smoothly with careful planning and attention to detail. From the initial contact with the insurer, through clarifying the transfer of the no-claims discount, to meeting notice periods – every step counts. Early information and comparing terms can help you save costs and ensure you have the right cover. Bear in mind that the termination of the old contract should only take place once the new one has been confirmed. With knowledge of the legal basics and the practical implications, you will be well prepared. If you would like individual advice or support with your change of policyholder, we will be happy to help. Request an individual risk analysis now: Have your insurance situation checked free of charge and receive concrete suggestions for optimisation.
More useful links
Wikipedia offers comprehensive information on car insurance in Germany.
The Federal Statistical Office (Destatis) provides tables and statistics on the vehicle stock in Germany.
The Consumer Advice Centre provides information on how you can save on car insurance.
The ADAC offers guidance on changing car insurance.
The Federal Ministry of Finance provides information on motor vehicle tax in Germany.
Kfz-Bayern offers downloads of contracts relating to vehicles.
The Federal Motor Transport Authority (KBA) provides information on the Central Vehicle Register (ZFZR).
FAQ
How much does it cost to change the policyholder on car insurance?
A mere change of policyholder is often free of charge or only incurs minor administrative costs. If this is accompanied by a change of keeper with re-registration and new number plates, the costs at the vehicle registration office can be up to sixty euros.
Can I transfer my no-claims bonus to my child?
Yes, transferring a no-claims bonus to children is possible with most insurers. However, the child can only take over as many claim-free years as they could themselves have built up since obtaining their driving licence.
Does the vehicle owner also have to be the policyholder?
No, the vehicle owner and the policyholder do not have to be the same person. This is referred to as different ownership. This is common, for example, when parents insure their child's car.
Do I have a special right to cancel when the policyholder changes?
A change of policyholder in itself does not automatically trigger a special right of cancellation if the registered keeper remains the same. However, a special right of cancellation often exists in the event of a change of keeper (e.g. sale), an increase in premium, or after a claim.
What is the difference between the policyholder and the registered keeper?
The vehicle holder is the person in whose name the vehicle is registered (entry in the vehicle registration certificate). The policyholder is the person who has concluded the insurance contract with the company and pays the premiums.
How do I inform the insurer about the change of policyholder?
Contact your insurance company in writing or by telephone. Often, a specific form or a written declaration of consent from both parties (former and new policyholder) is required.
