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DRAFT Insurances For Condominium: What You Should Know

1.10.2020
  1. Buildings insurance is compulsory almost everywhere
  2. Supplementary insurance for condominium associations
  3. The earthquake insurance
  4. The building liability insurance
  5. The glass insurance
  6. The home technology insurance
  7. The water insurance
  8. How useful is a legal expenses insurance?
  9. How useful is an own glass insurance?
  10. Ensure affordability after a stroke of fate

Security is individual. One person has a greater need for security, another a lesser one. This also applies to condominiums. Which insurances make sense for you as a condominium owner and your condominium owners' association, which ones do you need and which ones can you save depending on your personal security needs? With the exception of buildings insurance, which is mandatory in many cantons and highly recommended even without compulsory insurance, all insurance is voluntary.

Buildings insurance is compulsory almost everywhere

In 19 of 26 cantons, buildings must be insured with the public-law building insurance company. In the cantons of Appenzell Innerrhoden, Obwalden, Schwyz and Uri, buildings must be insured with private insurance companies because there is no cantonal building insurance. Only in the cantons of Geneva, Ticino and Valais is building insurance voluntary. Insurance premiums vary from canton to canton.

Condominium owners' associations should take out building insurance, even if it is not compulsory. It covers damage to buildings caused by fire or natural hazards. This means lightning strikes, landslides, explosions, rock falls, fire, hail, floods, avalanches, smoke, snow pressure, rock falls, storms or floods. That is why it is also called fire and natural hazards insurance.

Supplementary insurance for condominium associations

As a condominium owner, you own parts of a property with others and are part of a community. That is why you should take out important insurances jointly. In addition to building insurance, this includes these additional insurances, depending on the security needs of the condominium owners' association:

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The earthquake insurance

Although earthquakes are natural events, they are not covered by building insurance. In most cantons with compulsory building insurance, there is therefore the Swiss Pool for Earthquake Coverage, in other cantons there are other solutions, for example in the canton of Zurich the earthquake fund of the building insurance of the canton of Zurich. Both take over voluntary benefits from a certain strength of the earthquake, there is no entitlement. If your home is located in an earthquake-prone area, earthquake insurance with a private insurance company is worth considering.

Insurance for Condominium Owners: Earthquake Insurance
The earthquake risk is low, depending on the region, but the damage can be great.

The building liability insurance

Condominium owners have liability insurance. However, private liability insurance does not cover damage to the community. For example, if a rotten tree falls on the common property and falls onto the neighbour's property. Building liability insurance makes sense for condominium associations. On the one hand, it assumes claims for damages, advises the community in legal matters and rejects unfounded or excessive claims. On the other hand, it avoids discussions between the condominium owners as to who is responsible and liable for damage.

The glass insurance

Building insurance covers glass damage caused by natural hazards, but not damage caused by children playing, for example. Glass insurance distinguishes between furniture and building glazing. Damage to furniture glazing, for example a crystal mirror or a glass table top, is usually covered by your household contents insurance if you have included this add-on. Windows, glass fronts, glass doors or conservatories count as building glazing. The condominium owners' association should include such damage as an add-on in the building insurance or building liability insurance.

The home technology insurance

A multifamily house is full of home technology. Home technology insurance covers damage to the home technology that is permanently connected to the house. For example, the lighting, the electric garage door, the heating system or the photovoltaic system. The coverage goes beyond the scope of service orders, which include periodic checks and, if necessary, the replacement of wear parts.

The water insurance

The building insurance does not cover water damage caused by natural hazards, damage caused by rain, snow or melt water, burst pipes or water backups. If you want to protect yourself from the financial consequences of such damage, your condominium owners' association would have to take out water insurance. It covers the costs, for example, if a bathtub overflows, if pipes freeze and have to be thawed and repaired, or if oil leaks from a heating system or tank. The benefits and premiums vary from insurance to insurance.

Houzy Advice

Good to know

Construction and extension determine the risk. That is why water insurance premiums are higher for houses with flat roofs or underfloor heating than for other houses.

Insurance for condominium owners: Water insurance
For example, water insurance covers the damage if a condominium owner lets the bathtub overflow.

How useful is a legal expenses insurance?

In principle, no. Unless your need for security is high - or you rent out your flat. Legal expenses insurance covers, for example, the advance payment of costs, lawyers' fees and expenses for expert opinions as well as court costs and party compensation if you lose the case. You can take out general legal expenses insurance or special real estate legal expenses insurance. Make sure that labour law, property law, tenancy law, neighbour law, tort law, criminal law and insurance law are included and that you have a free choice of lawyer.

Houzy Hint

Tip

Take out legal expenses insurance for one year only. This way you can find out if you really need it and renew or cancel the insurance.

How useful is an own glass insurance?

As a rule, you do not need your own glass insurance. Damage to permanently installed glass is covered by the building insurance. This includes ceramic hobs in the kitchen, windows, glass fronts in the kitchen, the washbasin in the bathroom or guest bathroom, the toilet bowl or the conservatory. Damage to furniture, for example an aquarium, a mirror, a glass tabletop or a display cabinet, is covered by your household contents insurance.

Houzy Advice

Good to know

Spectacles, binoculars, crockery, glasses, light bulbs, hand mirrors, lamps, fluorescent tubes, magnifying glasses or vases are not insurable.

Ensure affordability after a stroke of fate

What happens to the family home if the main earner can no longer work or dies? As a rule, an income and a disability pension or a widow's and orphan's pension(s) are not enough to cover the housing costs. In the worst case, affordability is at risk and the family has to sell the home. With disability insurance, you supplement the pension benefits and have more financial leeway; with the lump-sum death benefit from a life insurance policy, you pay back part of the mortgage, reduce the housing costs and thus ensure affordability again.

If the condominium association is not insured or the insurance does not cover or only partially covers damage, you can pay for the repair of common components with money from the renewal fund. Therefore, put enough money aside. Most condominium owners' associations pay in 0.2 to 0.5 percent of the building insurance value of their property each year.

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