Taken from Lovejoy's site:
Some policies specifically exclude 'track use'. Since the Ring is legally a road but also undeniably a track, this policy wording could be interpreted as letting the insurance company off the hook. At the very least, it is likely to lead to extremely long and potentially expensive arguments. Some German policies go even further and specifically exclude the Ring by name: in those cases, there is no doubt at all that you are uninsured.
More typically, policies exclude 'racing, pace-setting and time-trials'. None of these terms would apply to ordinary use of the Ring, but the time-trial clause may be deemed to apply if you are timing your laps. German police are noted for the unvarnished truth in their reports, so if they find a running stopwatch on your bike or in your car, this fact is very likely to be noted in the official report of the accident. This is yet another reason not to time laps.
The other option is to buy special track insurance, but this tends to be very expensive with high excesses also. It is not untypical to have an excess of £1500 and then find cover limited to the next £10k or so.
One essential step for drivers from outside Germany is to double-check that you have full coverage for overseas use, not just the minimum legal cover. Some policies revert to minimum third-party cover when abroad: always check.