Market report: Why car repairs are becoming more and more expensive

Market report car insurance Why car repairs are becoming more and more expensive As of: October 29, 2026 • 2:14 p.m

Rising costs for spare parts and higher workshop wages - car repairs are becoming more and more expensive. Insurers therefore regularly increase prices, even if you have driven without an accident.

If the car has to go to the workshop, it usually becomes expensive - currently even more and more expensive, as the General Association of the German Insurance Industry (GDV) reported today in Berlin.

According to insurer figures, the cost of an average car repair in Germany has risen by around 70 percent to 4,600 euros within ten years. The reason for this is that both spare parts and workshop costs have become more expensive than average.

For motor vehicle insurers, this means billions in additional expenses - according to an analysis by the GDV from a year ago, spare parts costs alone have increased by an average of almost six percent, according to managing director Jörg Asmussen. For individual parts such as front doors or hoods, the increase was even higher.

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What is annoying for car owners means that insurers will have to spend billions in additional costs. According to GDV, the companies in the automotive division will just miss out on operational red figures this year. Payments to customers for car repairs and other services will then increase by a good ten percent to 35 billion euros.

Three large insurers, Allianz, Munich Re and Hannover Re, are represented in the DAX, most of which also offer motor vehicle contracts through subsidiaries. The market leader in Germany is Allianz, together with the unlisted HUK-Coburg Group.

The combined ratio - i.e. the ratio of payments to customers plus administrative expenses to income - is expected to be 99 percent. This means that for every 100 euros in income, the insurers only have one euro left in their cash register. “The sharp rise in workshop and spare parts prices is driving up claims expenses, which are growing significantly faster than premium income,” said Asmussen.

However, rising spare parts and workshop costs are not the only factors that insurance companies use to calculate their premiums. Because the providers assess their risks very carefully. The best known are the no-claims classes (SF), in which every policyholder is classified. The higher the SF, the more discount there is on the tariff - so those who report fewer damages benefit - even if the discounts are smaller for higher SFs than for new drivers.

However, the total amount of damage and the region in which the car is insured are also assessed - which is why vehicle insurance is also considered a form of solidarity. It can happen that the premium increases even though you haven't had an accident.

Otherwise, individual parameters are increasingly being taken into account: Is a car regularly in the garage, who is allowed to drive it and are there other contracts in the house? All of this can have an impact.

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Despite high costs, the motor vehicle insurance market is highly competitive among insurers. Many customers who have motor vehicle insurance often also have other contracts with the same insurer - from household contents to life insurance, which usually gives them a combination bonus.

While insurers have increased their vehicle prices significantly over the past three years, the price war seems to have flared up again this year. According to the brokerage portal Verivox, new contracts cost less than a year ago, at least in the low-priced market segment - this is primarily online insurance.

Motor vehicle contracts usually have a term of exactly one calendar year, i.e. until December 31st. Since the notice period is one month to the end of the contract, this can be done by November 30th at the latest. be terminated. A price comparison could be worthwhile, but should be comprehensive if you have several contracts.

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The DAX is currently struggling with the round mark of 26,000 points, continuing its recent upward trend. On Wednesday, the index closed 0.4 percent higher at 25,704 points. Investors appreciate that the central banks are unlikely to seek interest rate increases immediately.

“Like the US Federal Reserve, the ECB will probably keep its key interest rate constant,” predicted Thomas Altmann from asset manager QC Partners. “What is crucial is whether Christine Lagarde verbally prepares a possible interest rate increase for December.”

This topic in the program: tagesschau.de | Stock market: interim status at midday - car repairs are becoming more and more expensive | 10/29/26 | 12:44 p.m