Insurance customers forget that the price of their house or flat has risen rapidly in recent years. Since 2012, real estate prices have more than doubled. However, the fuses have not changed. In the case of problems that are not exceptional at all, they do not cover the current value of the property.
In the last few days, the Czechia has been plagued by a very strong wind. According to long-term storm insurance statistics, the vast majority of claims are real estate. “Storms usually involve thousands of claims. Property owners find themselves in a difficult situation, often exacerbated by property underinsurance. The insurance also covers flats that are only three years old,” explains Jakub Kolda, an insurance expert at Klik.cz.
A classic example is a ruined roof. If the property is insured at half its current value, the insurance company will logically pay only part of the insurance benefit. “People are often unpleasantly surprised. They remember that their property is secured, but they forget that its value increases over time. However, premiums do not match. At the same time, this does not always mean an increase in insurance,” points out Kolda.
We are still in the period of the longest growth in property prices – prices have been rising since 2012 and, according to statistics, many properties have at least doubled their value. However, practically the same applies to household insurance. People are improving their homes, buying more expensive things, doing construction work that is becoming more and more expensive.
“With older contracts, we really also encounter a situation where premiums cover less than half the value of real estate or households,” adds Kolda.
Source: Klik.cz and CTK
