Details about compulsory residential property insurance

What it is?

Apartment insurance is a contract for the protection of citizens' property, drawn up at the initiative of the home owner or third parties to minimize risks during the operation of a residential property.

Both the owner of the apartment and any of his friends or relatives can buy insurance.

In the US and Europe, 88% of the working population uses property insurance services. In Russia, the number of policyholders is several times smaller: only 1/10 of Russians use the services of insurance companies to protect property.

At the same time, the cost of the policy in the Russian Federation is 2/3 cheaper than offers from foreign companies (we discuss what factors influence the cost of insurance in this material, and you will find out how much a policy will cost to protect an apartment from various incidents here).

Pros and cons of this action

55% of Russians do not insure their homes because they do not trust insurance companies. This is due to the negative experience of relatives or friends who purchased insurance policies, but the company refused to pay them when an insured event occurred.

Those who also refuse to purchase a policy justify their decision by the high cost of services.

Large insurance companies of the Russian Federation (for example, Ingosstrakh, Soglasie, Rosgosstrakh), despite the low level of population involvement (less than 15%), always make a profit.

Supporters of policies insure an apartment, even if the cost of services increases by 20-30% (this is evidenced by data from insurance companies).

We consider the question of whether it is worth insuring an apartment in more detail here.

Advantages of taking out property insurance coverage

The choice of thousands of policyholders in the Russian Federation is not random:

• Protecting your apartment gives you a feeling of reliability and comfort.
• Policy buyers understand the responsibility for the safety of property.
• Clients are protected from unforeseen circumstances.
• Financial literacy increases.
• Relationships and understanding with neighbors improve. The policy guarantees that in the event of an insured event, property owners will be able to pay their neighbors without conflicts or litigation.

Minuses

But home insurance also has its downsides:

• High cost of payment for insurance coverage of over 3 million rubles and the number of risks from 5. Not every Russian can afford to purchase a policy for 10-15 thousand rubles.
• No 100% guarantee of payments. No insurer can say with complete confidence that the client will receive funds in the event of an insured event. If the beneficiary is partially at fault for causing the damage, payment of funds will be denied.
• Unreliability of some service providers. Unaccredited companies, deprived of a license, “lure” buyers with attractive amounts of payments at a very low insurance premium (up to 5 thousand rubles). As a result, buyers purchase a policy from a bankrupt company or a third-party organization that is not directly related to insurance.

Types of property insurance and legal requirements in 2020

Property insurance when concluding a mortgage lending agreement is divided into two types: mandatory and voluntary.

According to the law on mortgage lending in force in Russia, only insurance of the purchased object against destruction (loss) and damage - due to flooding, fire, etc. - is mandatory. All other types of insurance are not mandatory.

Among additional agreements, banks often offer to issue personal insurance - the health and life of the borrower, as well as title insurance - protection of the legal, legally and documented ownership rights of the bank client to the housing purchased with a mortgage.

Important! Many banks and insurers have comprehensive offers that include all of the above types of protection and others, such as life insurance. It should be remembered that imposing payment for protection against additional risks is illegal.

Types of policies

Depending on the type of purchase, there are:

1. classic policy issued at the insurer's office;
2. online document.

They differ in the method of registration, set of certificates and cost.

According to the target characteristics of insurance, there may be:

1. voluntary;
2. related to the lending agreement (in a mortgage transaction).

By payment type:

1. one-time payment;
2. installment policies.

By choosing parameters:

1. fixed, when types of services are included in the price, without the possibility of adjustment (generated protection package);
2. floating, with independent selection of necessary functions.

TOP 5 insurance programs for property

There are many property insurance programs. They all differ from each other both in the scope of risks and in the amount of payments and compensation. Main programs in this direction:

• Personal property insurance. This includes any material object that, in the client’s opinion, may be damaged or destroyed.
• Dacha-house-apartment – ​​residential property insurance program. Created to provide security and financial compensation in the event of damage or destruction of a structure.
• Small Business is a commercial program that allows small businesses and private entrepreneurs to protect themselves from the risks of lost profits, bankruptcy, etc.
• Travel safely - all types of risks associated with road traffic, cargo transportation.

Insurance as such has not fully taken root in Russia. Our people have yet to understand that this is neither a scam nor a waste of money. This is a real financial and psychological airbag, so necessary these days.

If I want to secure my home, whose services should I choose?

The buyer can purchase a policy either from a large supplier or from a private seller. Most Russians prefer large insurance companies that have a license and positive reviews.

Purchasing insurance from a dubious organization carries financial and intangible risks. In the event of an insured event, such sellers may refuse to pay without reasoned reasons or justification.

Often there are fly-by-night companies whose main goal is to receive funds from the buyer, without providing services and permission to carry out activities.

We have prepared and provided a rating of companies that provide apartment insurance services in a separate material.

Title Insurance

When purchasing an apartment, especially when purchasing it under one of the mortgage programs, citizens must pay for title insurance. First of all, in this way you need to insure housing purchased on the secondary real estate market.

The fact is that after signing the purchase and sale agreement, the relatives of the owner of the apartment may try to challenge his decision in court. In some cases, the court actually recognizes the cancellation of the transaction, so the buyer loses his money. If housing is purchased on credit, it remains pledged until full redemption. During this time, relatives and the seller himself may change their minds about selling the apartment, so banks require the purchase of a title policy.

Also, bank employees may insist on purchasing a policy if the apartment is in a new building. Pre-purchase of housing is fraught with risks, for example, bankruptcy of a construction company. In this case, only title insurance can help.

According to the title policy, the property is immediately insured for its full value, but experts advise adding another 10% to it. Additional interest covers the financial costs incurred for the preparation of accompanying documents.

The amount of insurance payments is always calculated individually. It may depend on the amount of insurance, the number of previous transactions and the duration of the insurance. If the apartment had many owners, then insuring such housing will cost more.

Unfortunately, the insurance company may refuse insurance to some clients . This can be facilitated by drawing up a contract while drunk or with serious violations of the procedure for its execution. Insurers often refuse tax evaders, so before purchasing a policy, you must pay all debts.

Insurance risks

Apartment insurance includes several protection options:

1. Decoration inside the apartment. In case of damage and flooding, as well as fire and other unforeseen circumstances, the buyer receives compensation from the insurance company. Find more information about home insurance against unpredictable elements here.
2. Movable property. These are all things, personal, sports, except for jewelry and fur items, as well as all equipment in the house, including furniture.
3. Responsibility to other residents. Even if the client lives in a wooden house or “Stalinka”, in the event of flooding, gas leaks, lightning strikes, etc., the beneficiary receives funds to resolve the housing issue with neighbors.

Property insurance

None of the buyers are insured against the fact that at some unfortunate moment there will be a fire or flooding of the neighbors' home. They may have time to become full homeowners, so all expenses will fall on their shoulders. In order not to suffer once again, it is recommended to take out a property insurance policy.

The cost of this policy can range from 0.3 to 1.5% of the total cost of the apartment per year. Insurance companies offer to protect your apartment from robbery, fire, flooding and other adverse events. Their list is agreed upon in advance.

Unfortunately, this insurance policy will cover the cost of restoring windows, walls and ceilings. As a rule, during a fire or flood, furniture and appliances suffer greatly. The new home owner will have to restore all this on his own, since the policy does not provide compensation for damage in this case.

Types of packages and comprehensive services from leading Russian companies

When buying apartment insurance, clients should focus on the reliability of the supplier, the availability of a license and the terms of the contract offered by the company.

Conditions for Russian companies - leaders in this field

When choosing an individual package, the policy buyer must decide which services to insure. This allows you to adjust the cost of the policy and the amount of insurance coverage.

What is box insurance?

Boxed insurance is a finished product, which is an insurance policy with predetermined data: price, list of risks, insurance limits and payment terms.

Unlike the standard method of arranging services, when the client himself selects the elements he needs and ultimately forms the final package, insurance in a box does not provide for such actions.

Another name for this product is express insurance. This name reflects the main advantage of insurance in a box - its speed and minimal time costs.

To purchase a policy, it is not even necessary to communicate with employees of the insurance company - in most cases, you can purchase it yourself using Internet banking or by paying for the selected package through an ATM.

Despite this ease of acquisition, the terms of the policy are most often very favorable and do not have significant restrictions.

Instructions for applying for a policy

Insurance buyers have the opportunity to obtain a policy in 2 ways: in the office or via the Internet.

Purchasing apartment protection from an insurance company

To register at the office, the client must take the following documents:

• Passport. If the purchase involves registration in favor of a third party, it is advisable to have a copy or data of the homeowner’s document with you.
• Information about the apartment. To make the task easier for the manager, it is recommended to take a property valuation document. They contain all the data about the residential property, including the infrastructure of the area and information about the developer.

The registration process takes 15-45 minutes.

1. The manager helps the client select an insurance protection package of interest, calculates the cost and coverage in the event of an insured event.
2. The client and the insurance agent fill out the information. It is recommended to check the contract for typos, errors in the owner’s name, or the address of the residential property. This data may affect the payment: if the information is not up to date, the policy is considered invalid.
3. The buyer reads and signs the contract and makes payment.
   If the cost of the policy is higher than the client expected, the company may offer payment in installments. But this may increase the price of insurance.

   It is more profitable to purchase apartment insurance online. The time to fill out is reduced to 15 minutes, a minimum of documents is required.

   The cost of online policies is up to 30% lower than issuing a similar service in the office.

After purchasing a policy, the client must check whether the insurance requires activation.

In Alfastrakhovanie or Sberbank Insurance, clients must activate the service in order to receive an insurance premium. Without activation, the service may be provided not to the beneficiary, but to the insurance buyer, or the policy will be “expired.” Activation should be performed within the time period specified by the company: usually 14-30 days after purchasing the service.

In special publications, our experts provide ratings of the most reliable insurance companies, and also talk about what title insurance is.

Online apartment insurance: instructions

When applying for a policy via the Internet, the policyholder enters all the data independently.

Companies have optimized the process of purchasing a policy for clients:

• Reduced service time. The buyer determines the parameters without the participation of an insurance agent and enters the policy data himself. With fast character typing and a pre-selected package, registration time does not take more than 5 minutes.
• Reduced the cost. An online policy is “more economical”: the cost of services on the website is 10-30% cheaper.
• Equated an electronic document to a paper medium. It is not necessary to print the insurance: a payment receipt in electronic form indicates the presence of protection on a par with a “paper” copy.

The process of applying for an online policy is simple:

1. The buyer chooses a company, goes to the website and selects a product.
2. Fills in information about yourself and the beneficiary (if he is not the owner of the property), the property.
3. Calculates and adjusts types of risks, policy cost and term.
4. Pays for the purchase and (if necessary) activates the policy.

We talk in detail about how to get apartment insurance and what methods this can be done here.

Home insurance allows the owner not to worry about the safety of property. You can purchase a policy without leaving your home and choose the optimal insurance conditions. Whether it is necessary to insure an apartment if there are no conditions stipulated by law, you decide for yourself.

Life insurance

Lending banks and private sellers sometimes show special concern for the life of the buyer . If he dies or temporarily becomes incapacitated, the deal will be canceled, and in the case of a loan, the bank will have to wait even longer to get all payments back. But it cannot be said that this insurance policy is completely unprofitable for the buyer of real estate. If he works in a risky job or has a serious illness, then insurance payments can save his family from poverty.

Some insurance companies prefer to refuse their clients if they do not see a real need for life insurance. However, they never refuse people who have already purchased such a policy.