Fire and Other Perils Insurance
Property insurance covering a building against fire, flood, and other sudden random events, required by banks on mortgaged properties and typically assigned to the bank as additional collateral alongside the mortgage.
Сфера дії: Польща.
Визначення
Fire and other perils insurance (ubezpieczenie od ognia i innych zdarzeń losowych) covers physical damage to a building from events such as fire, flooding, storm damage, lightning strikes, or explosion. Where a property secures a mortgage loan, the bank virtually always requires this coverage for the life of the loan, since the building itself is the collateral the mortgage relies on — if it were destroyed or badly damaged and uninsured, the bank's security would lose most of its value.
The borrower typically takes out the policy with an insurer of their choice — subject to the bank's minimum coverage requirements — and then assigns the claim rights under the policy to the bank (cesja praw z polisy), so that in the event of a covered loss, the insurance payout goes toward protecting the bank's interest before or alongside the property owner's. Some banks offer their own bundled insurance product, often at a discounted margin for borrowers who take it, though the borrower is generally free to choose an external insurer covering the same risks.
This insurance is separate from the optional low down payment insurance and bridge insurance a mortgage may also require — those cover risks specific to the loan structure and registration process, while fire and other perils insurance covers physical damage to the underlying property itself.
Приклади
A borrower renews their fire and other perils insurance annually as required by the mortgage agreement, sending proof of the assigned policy to the bank each year.
A kitchen fire damages part of an insured, mortgaged apartment, and the insurance payout is applied first to satisfy the bank's assigned interest before any remaining funds go to the owner for repairs.
A borrower switches from the bank's bundled insurance product to a cheaper external policy that meets the same minimum coverage requirements, then formally assigns the new policy's rights to the bank.
Як це впливає на купівлю та продаж
Borrowers should confirm exactly what the bank's minimum coverage requirements are before shopping for a cheaper external policy, since a policy that's too narrow can be rejected by the bank and delay loan disbursement or trigger a breach of the loan agreement's ongoing conditions.
