Though home insurance has become mandatory five years ago, only 18 percent of the 8.5 million homes in Romania had this type of compulsory insurance under the insurance pool for natural disasters, shows a study by


Mandatory household insurance policies cost EUR 20 for type A housing (structure made of reinforced concrete, metal or wood, stone exterior walls, burnt bricks or materials thermally or chemically treated). The maximum amount covered by this type of insurance is EUR 20,000. Type B housing mandatory insurance is set at EUR 10 per year and covers EUR 10,000 of the damage in case of natural disasters.

Risks covered by the mandatory policies include natural disasters such as floods, earthquakes and landslides. They are concluded annually and people who do not have them can receive a fine of up to RON 500.

For cases of fire, theft, hail, explosion, optional insurance policies can be taken out. They have higher payment rates, going up to EUR 50 or EUR 60 per year, depending on the value of the property.

The difference between the two is also that the voluntary insurance can include the categories of the mandatory policy and can also be made to cover goods.

For example, for a one bedroom apartment in Bucharest, taking out a voluntary insurance covering also some of the goods can cost between EUR 50 and EUR 150, depending on the insurer. If the policy is made out to include the compulsory option, it can cost between EUR 70 and EUR 170.

If the owner decides not to cover their goods, prices range between EUR 35 and EUR 150 for only the voluntary component, and between EUR 55 and EUR 170 for both components.

However, the latest changes made to the compulsory home insurance have created an impossible situation for home-owners: buildings that have been rated as class I risk in case of earthquakes can no longer be insured. By law, this type of buildings cannot have a compulsory insurance policy without having had consolidation works done first, and the owner cannot take out a voluntary policy without proof of having a compulsory policy first. Aurel Badea, responsible for goods and property in UNSAR (the Union of Insurers and Reinsurers of Romania) told that observations were sent to the Financial Supervision Authority (ASF) by UNSAR last week. and that discussions with the supervisory institution are ongoing.

Natalia Martian