German has a reputation for being a lame language when it comes to terms of insulting people. Well, some foreigners do not seem to understand how to put our beautiful language to its best use! Take advantage of composed nouns! (The following insults are hopefully sorted in increasing insult capability.)

Pantoffelheld : a man dominated by his wife; literally master of slippers
Schreckschraube : ugly woman; literally shock-screw
Wuchtbrumme : fat woman; literally impact of a steel-slab
Frauenversteher : man who flatters often, softie; literally someone who understands women
Penner : bum; literally sleeper (not composed, but commonly used - everyone not getting out of the way of someone who is in hurry is a potiential "penner")
Arsch mit Ohren : butt with ears; this is a funny one, sometimes used in the media, in advertisment or among friends
Pissnelke : idiot; literally pissing carnation
Schleimscheisser : shits slime; used for people who flatter
Korinthenkacker : shits "Korinthen", a sweet; meaning is the same as "Schleimscheisser"
Stiefellecker : boot licker; means the same as "Schleimscheisser", but with emphasis on servileness
falscher Fuffziger : liar, traitor; literally faked piece of 50 Pfennig (got out of fashion since the introduction of the EURO)
Hurensohn : sonofabitch
Klowichser : s.o. wanking on the toilet whilst sitting
Flachwichser : someone who squirts flat after wanking
Linkswichser : s.o. wanking with his left hand
Hinterlader : literally breech-loader; used for gay men
Schwanzlutscher : cock-sucker
Kinderschänder : child abuser


But if you REALLY want to insult a German, just call him a Nazi or Fascist. Chances are high that someone will wake up in a hospital. Calling someone a Nazi in a german bar lets the music stop playing.

Nevertheless, proper insulting in german without hurting to much is some kind of art. Spontaneous inventing of words composed of three words means the mastery of low offending, e.g. Schlafwagenschaffner (sleeper cabin train conductor), Hartgeldstricher, Dreigroschennutte (3-penny-whore), Zuchtpferdschänder (breeding-horse-desecrator), Hartz-IV-Empfänger (a jobless).

If you combine 3 words, the meaning of your insult is not as important as the sheer impact of this intricate word.
Hint: Insults composed of three words are rare. Combine 2-word insults with a word that can be used as a preposition, e.g. Kleinkinderschänder.

In addition, it is possible to combine ANY 3 words, but those are very special insults: Im-Sitzen-Pinkler (pisses while sitting), Strich-50-Fahrer (drives constantly at 50 km/h), Standstreifen-Benutzer (uses the trace spared for the ambulance).