When planning to acquire a new house, many questions require clear answers. Which furniture to choose for your home? Otherwise, what are the decoration ideas to arrange a beautiful terrace? Among the most important topics, home insurance deserves to be analyzed.
This is a category of insurance designed to protect your belongings as well as your property. Whatever your status, tenant, owner, or co-owner, the plan protects you from everyday life damages.
Also known as multi-risk home insurance or MRH, a home insurance contract covers premises used as a residence or dwelling, retaining walls, fences, verandas, cellars, garages, and many others.
📋 The essentials at a glance: Personally, I consider that the question does not even arise, because the absence of coverage can cost hundreds of thousands of euros in the event of a claim. In my opinion, even if the law is lenient for some owners, civil protection is an essential security for your assets. In France, 97% of households are covered, reflecting the crucial importance of this guarantee in daily life.
When should I subscribe to insurance?
Before answering when and how to subscribe to home insurance, it is appropriate to determine the good reasons to take this plan. We probably do not think about it, but unforeseen events can arise when least expected. It is in this context that it is essential to subscribe to home insurance. Thanks to it, the insurer takes care of compensating all damages.
Whether it is water damage, an explosion, or a fire, the company covers damages to real estate or movable property, the tenant’s or owner’s civil liability, and private life civil liability.
To contract housing insurance, the ideal moment will be the exact day of handing over the keys. It is important to specify to the insurer the date you move into the dwelling.
You must conclude the contract by the day before the acquisition deed or lease signing. To ensure the insurance is fully operational, remember to consider the deadlines set by the insurance code.
📍 My experience: In 2023, I saw a friend who owns a single-family home decide not to insure to “save” 300 euros per year. A simple water damage from a buried pipe caused 12,000 euros of repairs at his exclusive expense. The lesson learned is harsh: zero risk does not exist and the savings made are negligible compared to the potential consequences.
Is home insurance mandatory or not?
🌟 The Advantages
- Legal protection included
- Coverage for relocation
- Total financial security
🔍 Reservations
- Sometimes high deductibles
- Exclusions of coverage
The answer to this question depends on the status of the future insured. For those who are renting, home insurance is mandatory. Since they are responsible for any potential damages, they must therefore repair the damage.
| Occupant Status | Legal Obligation | Minimum Required Coverage |
|---|---|---|
| Tenant (unfurnished or furnished) | Yes | Rental risks (fire, water damage) |
| Co-owner | Yes | Civil liability towards neighbors |
| Owner of a single-family home | No (but recommended) | None (unless specified in a loan) |
| Roommate | Yes | One contract per roommate or a joint contract |
By subscribing to at least a rental risk coverage, it allows covering the risks. This plan covers damages caused to the owner by water damage or fire.
Like the tenant, a roommate must also mandatorily insure a shared apartment. All individuals living under the same roof are required to contract a shared housing insurance. It is recommended to subscribe with the same insurance company to simplify procedures in case of a claim.
As for the owner, two scenarios are possible. For a non-occupying owner or an owner living in a condominium house, a home insurance as civil liability must be subscribed. This covers at least damages caused to others.
Regarding the second situation, an owner who occupies their own house is not obliged to contract home insurance. However, it remains essential in the event of theft or fire. If no affiliation to a home insurance has been made, the owner will inevitably have to seek recourse against the responsible party. And logically, they will not be compensated.
🌍 Did you know?
Since the 2014 Alur law, if a tenant does not provide their certificate, the owner can subscribe to insurance on their behalf and pass the cost on to the rent.
What do I risk if I don’t have home insurance?
As explained above, a tenant is required to subscribe to housing insurance. If this is not the case, the landlord can contract insurance on their behalf. Otherwise, they have the right to terminate the rental lease.
When the owner subscribes to home insurance on behalf of the tenant, they must provide them with a copy of the insurance contract.
The amount of the annual insurance premium can be recovered by the owner from all rent payments made by the tenant. This will be mentioned on the receipt and on the payment notices.
If the tenant provides a certificate of insurance, the owner must then terminate the contract subscribed on the tenant’s behalf as soon as possible.
For an individual dwelling, subscribing to home insurance is optional. If the owner decides to take it out, they will be compensated in case of hazards according to the extent of the damage suffered.
Otherwise, they must pay all damage costs out of pocket. Due to lack of funds, they are forced to take out a loan to be able to cover it.
⚠️ Common misconception
Thinking that the condominium insurance covers your personal belongings. This is false: it only covers the common areas and the building structure, never your furniture or valuables.
What is the mandatory insurance?
- Role of insurance: Using insurance not only secures your future but also protects your daily life.
- Diversity of policies: Between car, school, home, health, or borrower insurance, there are many different policies each with its own specifics. While some are required by law, others are optional.
- Housing obligation: Home insurance is part of the mandatory procedures, especially for co-owners and tenants. It is established to protect the family assets.
- Multi-risk home insurance: The insurer also offers multi-risk home insurance covering family or tenant liabilities and personal belongings. This insurance protects the occupant of the dwelling, regardless of their status or family situation.
- Health insurance and mutual: As for health insurance, it can be mandatory for everyone. However, individual health mutual insurance remains optional. For private sector employees, collective health mutual insurance is also required.
- Car insurance: Now let’s talk about car insurance; anyone using a motor vehicle is responsible for any harm caused to others. Subscribing to this policy is therefore unavoidable.
What laws impose home insurance obligations?
According to the law, the tenant, but not the owner, is primarily responsible for repairing damages. Whether these are caused by water, an explosion, or a fire, the owner is not required to take out home insurance to cover these risks.
On the other hand, the tenant is obliged to do so. It is Article 7 of the law dated July 6, 1989 that mandates subscribing to this type of insurance.
The tenant has the option to choose the insurance company that suits them. They must present a certificate from the insurer to the owner proving their subscription.
💡 Practical advice
Take photos of your invoices and valuables. In case of total loss, these digital proofs stored in the cloud will greatly facilitate your compensation.
Home insurance and PNO insurance: what is the difference?
| Criteria | Home Insurance | PNO Insurance (Non-Occupying Owner) |
|---|---|---|
| Target audience | Tenants or owner-occupiers | Owners who do not reside in the property |
| Main objective | Protect the living place and its occupants | Protect a rented or vacant property |
| Main coverages | Fire, water damage, theft, civil liability | Building damage, rental disputes, unpaid rents |
| Legal obligation | Mandatory for tenants | Recommended but sometimes mandatory in co-ownership |
| Civil liability | Covers damage caused to third parties | Covers damage caused by the rented or vacant property |
| Complementarity | Only covers the occupant | Complements the tenant’s insurance |
The first is intended for any occupant, whether owner, tenant, or co-owner. If the policy is required for the co-owner and the tenant, this will not be the case for the owner-occupier.
It allows coverage of expenses related to damages your property suffers. It thus offers financial protection compensating for losses in case of fire or theft.
As for PNO insurance, it differs from tenant home insurance and owner-occupier home insurance.
Also called landlord home insurance, non-occupying owner insurance covers a temporarily unoccupied apartment or house against risks.
Even when vacant, a dwelling is exposed to countless risks such as a short circuit or a water leak. This policy is intended for the non-occupying owner. This is the case for landlord owners, as they have invested in a rental property and it is not their responsibility to occupy it all year round.
Tenants and co-owners are required to subscribe to this plan because it protects them from potential incidents. Thanks to compensation, they do not have to cover all the repair costs.
If you are a tenant, you must contract it to avoid problems with the landlord. Conversely, if you live in your own house, subscribing is not mandatory because you are in the status of the owner.
Often, some dishonest insured individuals make a false theft declaration to the insurer to benefit from compensation. When the company discovers it, it has the right to terminate the contract immediately. In the event of a real disaster, it offers no coverage.
