Property insurance: the fine points

Property Insurance: Voluntary Property Insurance for Individuals and Legal Entities.

Property may be your only apartment, investments, luxury real estate, means of production, an office, a multifunctional shopping and entertainment complex, a restaurant and so on. This article explains how to protect all of it. Of course, one article cannot cover every nuance of property insurance, but we will try to highlight the main and most frequently encountered ones. It would be naive to think that after reading this article you will be able to choose an insurance company and insure your property without mistakes and entirely correctly, but the article aims to help you avoid some difficulties.

We also recommend deciding first on the sum insured (the value of the property) for which the property complex will be insured. If this article has not answered your questions, see other similar materials.

The main things to understand and know about property insurance are:

• property insurance is a voluntary class of insurance, i.e. it is not regulated by law and no one is obliged to insure property;
• when concluding a property insurance contract, the rates, the contract, the terms, exclusions, insured events, etc. can be agreed with the insurance company and fully negotiated;
• property insurance rates vary over a fairly wide range.

Risks and insured events in property insurance

We divide insured events in property insurance into:

Standard

• loss (destruction) of or damage to property as a result of the following events:
• fire, lightning strike, explosion, including explosion of gas used for household purposes
• crash of manned aircraft or their debris, cargo or objects from them onto the insured property;
• natural disasters, hail, hurricane, snowfall, etc. (excluding earthquake);
• earthquake;
• explosion of gas storage facilities, gas pipelines, machinery, apparatus and other similar devices;
• impact by vehicles or self-propelled machinery;
• unlawful acts of third parties (burglary, robbery or armed robbery);
• damage to the insured property by water from water supply, sewerage, heating and fire-extinguishing systems, including from a swimming pool;
• equipment breakdown;
• terrorist act;
• breakage of glass/doors, impact damage to gates by third parties.

Additional

• civil liability for causing property damage to third parties;
•  business interruption.

For a separate review of property insurance risks and a detailed description, if necessary, contact the insurance brokers and agents listed in the association's registry.

Who we recommend to insure property

1. Owners of plants whose entire means of production constitute their property;
2. Warehouse premises, including leased ones;
3. Supermarkets and leisure centres (clubs, restaurants, shops);
4. Luxury real estate (apartments, houses);
5. Hotel complexes.

Any property owner can insure their property, since virtually every property is the result of the work of many people or something that more than one generation has worked for. It would therefore not be quite right to go on listing in detail the objects we recommend insuring.

We particularly recommend insuring property in seismic zones and in areas of high man-made hazard.

Nuances

Pay particular attention to:

• a detailed study of the exclusions in the property insurance contract;
• reviewing the insured events and asking for them to be explained;
• the amount of the deductible.

What is new in property insurance 

The Ministry of Economy and Budget Planning is drafting a Law "On Compulsory Insurance of Citizens' Real Estate", which includes provisions on introducing a system of insurance against natural and man-made emergencies.