A building's life does not run to renewal dates: the renovation finishes in summer, the solar panels go up in autumn, and rising construction prices do not wait until April. The good news: the sum insured is no prisoner of the renewal date either – it can be raised mid-term. This article shows when and how it is worth touching the sum between two renewals.
- The typical reasons for raising the sum: renovation and extension, a valuable new element (solar panels, building systems), or the realisation that the sum has fallen behind reality.
- The process is simple: notify the insurer → an amended quote → an amendment to the policy → a pro-rata additional premium.
- The risk of putting it off is underinsurance: a claim does not look at the renewal date but at the sum insured that applies on the day of the loss.
When does the sum have to be raised mid-term?
Three typical situations. The first is investment: a new roof, façade insulation, upgraded building systems, an added storey – the building's rebuild value has grown, and the sum has to follow (the renovation article). The second is a new element: a solar panel system, a heat pump, a camera system – whatever was not there before has to be notified and priced (the solar panel article). The third is realisation: a review or a claim reveals that the sum is out of date – waiting until the next renewal date at that point is voluntary risk-taking, because a claim looks at the position in force on the day it is reported (underinsurance).
How does the amendment work?
The process is shorter than taking out a new policy: the building (the property manager) notifies the insurer of the change and of the new value – for a renovation, typically supported by the investment documents – the insurer issues an amended quote, and once it is accepted the policy is amended, with a pro-rata additional premium for the time remaining until the renewal date. Two warnings: the amendment works forwards (retroactive “tidying up” is not a thing), and it is worth seeing the effective date recorded in writing. The decision side depends on the building: under the mandates in the organisational and operational rules (SZMSZ) this may fall within the property manager's authority, or it may be a matter for the general meeting – where the premium impact is larger, a properly worded resolution serves well here too.
An increase, or a full review?
A mid-term increase is a targeted intervention – its job is to keep the cover from drifting away from reality between two renewals. If, however, the change is a large one (a significant extension, a change of use), or other questions come up alongside the increase (scope of cover, limits), it may be worth holding an early full review instead of a targeted amendment – and even timing the tendering to the building's new state. The dividing line is practical: what can be described with a single data change is an increase; what redraws the building's risk profile is already a review.
The system in which this is second nature
A mid-term increase works well where there is a system: the person responsible for insurance (the property manager, the managing agent) knows about the investments, the file is up to date, and the renewal routine goes through everything anyway. That way the sum is never “a figure from some point in the past” but a living number – and the building's cover is in the same state as the building itself.
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