Loss of Use (Nutzungsausfall)

Concept

Loss of use is the economic disadvantage suffered by an injured party from being unable to use a damaged item – typically a motor vehicle – during the repair or replacement period, without having rented a substitute item to cover the gap. In motor third-party liability insurance, loss of use compensation is one of the regularly recognized loss components to which the injured party is entitled in addition to the pure cost of repair.

Assessment of the Compensation

The amount of loss of use compensation is generally determined in practice using standardized reference tables (e.g., daily rates tiered by vehicle class) that reflect the economic use value of the relevant vehicle type; it is awarded for the specific, demonstrable period of unavailability and generally requires that the injured party actually depended on using the item.

Alternative to Reimbursement of Rental Car Costs

Instead of loss of use compensation, the injured party may alternatively choose to be reimbursed for the actual costs incurred for a rental car; the two claims are mutually exclusive, since they compensate the same economic disadvantage – the lost ability to use the damaged vehicle – in different ways.