Changes to consumer law for retailers, financiers, and insurers

On December 19, 2025, the German Bundestag passed the "Act Amending Consumer Contract and Insurance Contract Law and Amending Treatment Contract Law." 

The Act serves to implement several EU directives, in particular EU Directive 2023/2673 amending the Consumer Rights Directive in the area of distance contracts and financial services contracts and EU Directive 2024/825. Member states must transpose the EU requirements into national law by December 19, 2025. 

The law brings important changes to consumer and insurance contract law. Subject to a few special exceptions, the law is scheduled to come into force on June 19, 2026.

1. Electronic withdrawal function ("withdrawal button") for online contracts

Providers must provide a visible and easily accessible electronic withdrawal function (withdrawal button) for all distance contracts concluded online (e.g., goods, services, digital products, or financial services contracts). This function must be available during the statutory withdrawal period. Consumers can thus withdraw from the contract directly via the online platform – without having to send a declaration by post or email. In the event of withdrawal, the entrepreneur must send the consumer a confirmation of receipt containing the content of the declaration of withdrawal, as well as the date and time of its receipt.

2. Restriction of the previous "perpetual right of withdrawal"

In the case of financial services and insurance contracts, the withdrawal period did not previously begin to run correctly after the conclusion of the contract if there were errors in the instructions – which meant that withdrawal was possible for an unlimited period of time under certain circumstances. This "perpetual right of withdrawal" will no longer exist for contracts concluded on or after June 19, 2026.

The extended withdrawal period is limited by law to a maximum of 12 months and 14 days after conclusion of the contract, provided that the consumer was informed of their right of withdrawal in the first place. Due to their complexity, a longer period (24 months and 30 days) applies to life insurance policies.

3. Extended information and explanation requirements

The information requirements for contracts concluded outside of business premises and distance contracts for financial services are being expanded once again. This includes not only the provision of information, but also the requirement that this information be explained in an understandable manner, e.g., through additional explanations in simple language. 
In future, user interfaces for financial services contracts must allow the contract click path to be easily canceled. The law establishes the principle that when concluding financial services contracts at a distance, businesses may not design, organize, or operate their online user interfaces in such a way that consumers are manipulated or otherwise significantly impaired or hindered in their ability to make free and informed decisions.

Traders must provide consumers with clear and comprehensive information about statutory warranty rights and durability guarantees. In the case of goods that contain digital components (e.g., smart devices), entrepreneurs must in future provide clear information about software updates, reparability, or existing digital content.

4. Changes to insurance contract law

Significant changes also affect the Insurance Contract Act (VVG). There is a clarification of when the right of withdrawal expires in insurance contracts. The statutory model withdrawal policy is being amended. In addition, the information and instruction obligations of insurers towards their customers are being further expanded.

5. Treatment contracts

The implementation law also contains provisions on treatment contracts. Upon request, patients must be granted immediate access to their treatment records. Patients may also request an electronic copy of their treatment records.  

Result, need for implementation

The new law strengthens consumer protection in several areas through:

• digital withdrawal options,
• clear and transparent information requirements,
• protection against manipulative online practices.  

For retailers, financiers, and insurers, however, this also means:

•  more compliance obligations,
• the need to revise internal processes and systems,
• greater requirements for contract communication and information management.

Online sales and checkout processes must be adapted to the new legal situation. Contract documents and information sheets must also be revised.

However, the time limit on the right of withdrawal leads to greater legal clarity.