“The building is insured – so I don't need home insurance any more?” And the mirror question: “I have home insurance – why should I pay towards the building's policy as well?” Both questions spring from the same misunderstanding: that the two policies serve the same purpose. In fact they are not competitors but two layers of one protection system – and a family is well covered when both layers are in place.
- Condominium insurance protects the common property: roof, structure, stairwell, risers, common areas, building liability.
- Home insurance protects the flat's private property and its contents: furniture, appliances, personal belongings – and the resident's own liability.
- The building's policy will not protect your kitchen units; home insurance will not renew the roof – the two complement each other.
Who covers what? The division of labour
Condominium insurance applies to the commonly owned parts of the building – to where the ownership is shared as well. Home insurance begins where private property begins: the interior spaces of the flat, its finishes, its sanitary ware, its fitted and free-standing furniture, the household appliances and personal belongings. The exact line depends on each building's deed of foundation – that is what the boundary article is about – but the principle of the division is always the same: shared property to the building's policy, your own property to your own.
Two examples that show everything
A storm strips the roof, and the ceiling in the top-floor flat lets in water. Restoring the roof is a matter for the building's policy – the roof is common property. The laptop and the rug ruined inside the flat, however, are contents: they belong to the resident's home insurance. A single storm loss contains the whole division of labour: at one and the same event, each policy has its own job to do. It works in the other direction too: if a privately owned pipe inside a flat gives way and the damage spreads to the neighbour, the building's policy typically does not respond – there it is the resident's liability and home insurance that do the work. The water ingress article works through this situation.
“Aren't we paying twice this way?”
No: the two policies apply to different property, and an overlap can typically only occur in the border strip – for example with structural elements inside the flat, if the building's policy extends to those as well. It is worth clarifying this once: if the building's cover is known, home insurance can be sized precisely to fit it, and nobody really pays twice for the same thing. A good tool for the property manager here is the resident information sheet: on a single page it tells residents what the building covers – and what they should insure themselves.
What to do as a resident – and as a property manager?
As a resident there are two things worth knowing: what the building's policy covers (ask the manager for the summary), and how to size your own home insurance to match – you will find guidance for that on lakas.biz (in Hungarian). As a property manager it is the other way round: it is worth making the building's cover transparent to the residents, because a well-informed resident heads in the right direction at claim time too – and insurance is easier to talk about at the general meeting.
A question about your own building? Book a free 20-minute consultation →
