Motor Insurers' Guarantee Fund (Verkehrsopferhilfe)

Concept

The motor insurers’ guarantee fund is an institution supported by the insurance industry that provides compensation to victims of traffic accidents where they are unable to enforce their claims against the actual tortfeasor for certain reasons – for example, because the tortfeasor is unknown (hit-and-run), the vehicle causing the accident was not covered by liability insurance despite a statutory insurance requirement, or the responsible motor liability insurer has become insolvent.

Funding and Sponsorship

The motor insurers’ guarantee fund is financed through levy contributions from all motor liability insurers in a market, who are obligated to contribute to covering the compensation paid out by the institution; it thus functions as a collective backstop mechanism for the entire insurance industry, ensuring that accident victims are not left without compensation due to circumstances such as the tortfeasor’s unidentifiability or insolvency.

Right of Recourse

After the guarantee fund has compensated the injured party, that party’s claims against the actual tortfeasor transfer to the institution by operation of statutory subrogation, allowing it – if the tortfeasor is later identified or becomes solvent again – to pursue recourse against them; the guarantee fund therefore differs structurally from ordinary motor liability insurance, as it functions as a backstop mechanism rather than as an original contractual insurance arrangement.