The survey showed whether Lithuanians value their home: how much money are they willing to spend

How popular is home insurance in Lithuania?

Some residents insure their homes with insurance to protect themselves over long distances in the event of an unforeseen disaster at their home. However, how popular are they in Lithuania? Delfi Būstas interviewed several of the largest insurance companies in Lithuania and asked if many people insure their homes and what they insure against.

According to Andrius Dambrauskas, Gjensidige’s director of insurance products, risk assessment and pricing for the Baltic countries, home insurance is probably the most popular in the country.

“We started monitoring the Lithuanian approach to home insurance almost a decade ago. If only a fifth confirmed that they have home insurance, this year, according to a survey conducted by Nielsen on our behalf, 57% of those people in Lithuania (last year it was 50 percent). This is the most popular type of voluntary insurance in the country. Even more interesting is the fact that more and more people are citing home insurance as the most important measure of home security. This year, 58 percent thought so. country’s population (Nielsen survey, February 2020). Last year, 50 percent of those who responded this way, ”says A. Dambrauskas.

According to the interlocutor, there is a decrease in the number of people who do not take any measures to protect their homes. Last year, this was confirmed by 19 percent. of those surveyed, this year, only 15 percent. For many years it has been observed that when asked what is the most prized tangible property, people unanimously name their houses. A survey this year showed that 82 percent believe so. Lithuanian. Estonians value housing more than we do: 86 percent. Latvians appreciate a little less houses: 72%.

Linas Laugalis, director of insurance products and risk assessment at Compensa Vienna Insurance Group, also ensures that residents tend to protect and insure their homes.

“During the first seven months of this year, we accounted for up to 16.3 percent. More residential property insurance contracts than during the same period last year. We noticed that more clients applied not for permanent home, but for homeowners insurance. for unfinished construction. After all, most, even 60 percent. – Insurance contracts are concluded for permanent apartments. The rest goes to residential housing (40%). During the quarantine period, as customers they spent more time at home, we also registered more damage to the property of the neighbors, ”says the interlocutor.

However, according to him, the so-called “insurance” in the private property market is relatively low: it is estimated that around 25% of people are insured in Lithuania. apartments and about 50 percent. residential houses. However, you can see that residents are increasingly concerned about the safety of their property: the market for private property insurance is growing by about 6% every year.

“Clients feel the practical benefits of insurance when they choose to insure the property manager’s liability (protection is valid in cases such as flooding of neighbors’ home) and personal liability (protection is valid in cases in which domestic actions cause damage to third parties) In addition, when acquiring the “Help at home” service and receiving emergency assistance at home in the event of an accident or breakdown, “says the interlocutor.

However, Aušra Jusė, Director of ERGO’s Private Client Insurance Division in Lithuania, states that, across the entire Lithuanian market, home insurance volumes decrease every year: in 2017, the entire property insurance market staff grew 10.8 percent. 2018 – 9.5 percent, 2019 – 8.6 percent, and during the first half of 2020, growth reached 6.6 percent.

“In our country, the population is insured about a third of the house, which is not much compared to other countries. Still, while the number of new clients or interest in home insurance is not huge, we note that the needs of home insurance clients are changing. Customers are becoming more aware and not limited to choosing standard traditional hazards such as fire, theft, natural forces, plumbing accidents. More and more people choose all the risks of home insurance that are offered, that is, they choose to insure their home against any unforeseen or unforeseen ”, assures the interlocutor.

Andrius Gimbickas, director of residential property insurance at Lietuvos Draudimas, says that between 25% and 30% are insured in Lithuania. apartments and 50-55%. House. This means that in the event of a household disaster (fire, flood, severe storm or other), most of the consequences of the disaster must be dealt with on your own. Specifically: three out of four apartment residents and every second, a house.

What disasters are most prohibited?

“Delfi Būstas” asked which disasters Lithuanians are most likely to insure households. According to Aušra Jusė, Head of the Department of Insurance for Private Clients of ERGO Lithuania, when choosing a home insurance, the owners of different homes express different needs.

“For example, apartment owners understand the need for insurance against plumbing accidents, because this type of damage occurs more frequently. All the more so that both materials and repairs become more expensive. It is very important that the owners private companies insure against losses caused by the forces of nature. Farm and summer home owners are the most fearful of fires and theft, which is why they choose such insurance risks. In general, people are more focused in getting an insurance benefit if they break a plate, a mobile phone or scratch a new table, and the reality is that the greatest damage is done and the greatest insurance benefits are paid in the event of fire, plumbing accident, theft. In the case of these events, people need the help of insurance and benefits more ”, says the interlocutor.

Linas Laugalis, Head of Insurance Products and Risk Assessment at Compensa Vienna Insurance Group, assures that, according to company statistics, the distribution of property damage to the population is as follows: water risk – 35%, risk of fire – 16%. , various sudden and unexpected events – 17%, neighbor flooding – 9%, broken glass – 9%, failure of heating systems, appliances – 8%. Another small percentage is due to theft, robbery, vandalism, vehicle collisions, etc.

“Personal property insurance covers protection against a wide range of risks, so that our clients can choose the one they need most. Based on the risks identified by the client, analyzing them together, we can model the insurance coverage adapted to a specific object and calculate the insurance premium accordingly, thus helping the client to save. The average compensation of the insurance in case of fire is 4,5 thousand. EUR, water – 550 euros, breakdowns – 400 euros, theft – 600 euros, when the average insurance premium for an apartment is around 80 euros, and for a residential house around 160 euros ”, comments the interlocutor.

According to Lietuvos Draudimas, the results of a public opinion poll show that people are afraid of disasters that may occur in their home, but this does not necessarily encourage them to protect it. A third of apartment residents admitted to having considered property protection measures one or even several times.

According to the survey, this is the most frequent case of residents with a monthly income of less than 500 euros. It would be extremely difficult for them to recover from disasters because there is less savings. And if you save, it is to cover the specific needs of the family: children’s education, vacations, major purchases ”, the company points out.

According to A. Dambrauskas, Gjensidige’s Head of Insurance Products, Risk Assessment and Pricing for the Baltic States, claims experts estimate that a quarter of all home losses are caused by water, i.e. floods. Practice shows that old or faulty plumbing, the negligence of the clients themselves or neighbors in the home usually cause flooding. Every year more and more people suffer water damage or loss of homes and property.

“Meanwhile, the fire is only 3 percent. Events, but their losses sometimes amount to several hundred thousand euros. Fires are usually caused by messy electrical installations or by the unsafe use of electrical appliances, stoves and messy fireplaces, even food and candles left unattended. Fires can be prevented by sight: check electrical installations, use neat appliances, do not overload the electrical grid. Every time you leave home, assess whether the house is safe , if the electrical appliances are off, if the heating appliances are not left on, if the telephones and other chargers are unplugged, if the stove is left on ”, recommends the interlocutor.

Insurance companies note that in autumn, the attention of the population is drawn to the beginning of the heating season, when the probability of fires increases after a disruption in heating systems or due to disorderly furnaces and chimneys. There is also a sense of relevance due to the water damage and flooding in the apartments. And, of course, residents are warned of the threat of theft.