What is the cost of tenant fire insurance in Belgium?
What is the cost of tenant fire insurance in Belgium? Insuring a house or an apartment can be expensive. Discover what lies behind your insurance premium 👇
How is the average cost of tenant fire insurance calculated in Belgium? 🤔 Fire insurance for a rented apartment or house typically ranges from €100 to €400 per year. Despite our prompt response, given the potential variations, you’ll understand that calculating the price of tenant insurance isn’t so straightforward. In reality, the premium amount for home insurance depends on numerous factors, such as the type of property and the region (Flanders, Wallonia, Brussels) you are in. We’ll help you better understand the cost of tenant insurance and how fire insurance premiums are calculated.
How much is tenant fire insurance in Belgium?
To establish initial price ranges, we’ve based our calculations on the basic coverage, which is the minimum mandatory requirement in Belgium, covering tenant’s civil liability.
Insurance for a rented apartment
- For a 1-bedroom apartment, insurance premiums vary between €85 and €185. On average, you may need to add between €20 and €90 for additional coverage (contents, legal protection, theft and vandalism).
- For a 2-bedroom apartment, rates range from €110 to €200. These prices do not include options like theft and vandalism coverage.
- For a 3-bedroom apartment, tenant insurance costs between €130 and €245.
- Lastly, for a 4-bedroom apartment, the cost of tenant fire insurance in Wallonia or Brussels falls between €140 and €275.
Insurance for a rented house
- Insuring a 2-frontage house costs between €150 and €471. Theft and vandalism coverage is advisable for high-risk areas, adding an average of around a hundred euros.
- For a 4-frontage house in Belgium, the price of fire insurance ranges from €150 to €480. Family insurance can be added as an option.
What other factors can influence the cost of my tenant insurance?
Home insurance is often more expensive when acquired through an intermediary, such as a broker or insurance agent 😅
The difference between the two? A broker offers multiple insurance brands, whereas an agent deals with a single brand. Banks like Belfius or KBC/CBC, selling insurance products under the same brand, are essentially agents.
In both cases, these individuals or companies act as intermediaries between you and the insurance company. For their services, they are compensated by the insurer. They receive a commission, which can go up to 25% of your insurance premium. This is referred to as acquisition costs.
The advantage of using a broker or agent is the tailored service. However, this service comes at a cost that you should take into consideration.
How is the cost of tenant fire insurance calculated in Belgium?
Various methods are used to calculate home insurance premiums in Belgium.
The two main methods are:
- The fire insurance evaluation grid
- Flat-rate tariffs
Several criteria are then considered, including living area, rent amount, property type, location…
Consequently, each insurer offers a different rate for tenant insurance. This can lead to significant variations, even doubling or more! 🤯
Calculation based on the fire insurance evaluation grid
The evaluation grid provides a “tailor-made” coverage. It consists of a questionnaire about your dwelling, completed by an expert. They determine the reconstruction value of your home and furnishings, helping calculate the corresponding insurance premium.
What are the advantages and disadvantages of this method? 👇
- This evaluation yields a more accurate price, aligned with the actual value of what’s insured.
- The grid is especially useful for high-value real estate.
- However, this method isn’t suitable for those in need of rapid insurance.
- This approach requires expert involvement and isn’t easily available online or in a few minutes at an insurance office.
Calculation based on flat-rate tariffs
Flat-rate calculation produces an average insurance premium. This is adapted to a range of similar properties, known as a segment.
It establishes a fixed amount covering all rental risks associated with a property. Flat-rate prices typically rely on a limited number of criteria, such as property type, location, or livable volume in cubic meters.
What are the advantages and disadvantages of a flat-rate insurance premium? 👇
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- Subscribing to a flat-rate insurance is easier and quicker.
- It can be done online or within minutes with an advisor.
- However, the price of tenant fire insurance may be less precise under a flat-rate system, sometimes benefiting the client, sometimes not.
- Flat-rate pricing includes limitations on coverage within the insurance product. For example, the coverage amount for jewelry theft in the “theft” guarantee will be capped. However, this type of premium suits the vast majority of cases.
The person responsible for calculating insurance premium amounts is an actuary.
An actuary is often a mathematician. In essence, a numbers person. They hold a crucial role in the insurance sector 👑
They define a fair price for the consumer (you) that’s also profitable for the insurance company.
Insurance rates increase every year. Why?
Tenant fire insurance rates are indexed based on the ABEX index. This index represents the construction prices in effect in Belgium. As it’s updated every 6 months, fire insurance rates also change biannually, in January and July.
Insurers use this ABEX index for home insurance because, in the event of a total loss, they must indemnify their clients for the new replacement value of their property at today’s cost.
An example? 👇
If a house cost €250,000 to build in 2010, reconstructing the same house in 2023 would likely cost around €320,000. Thus, it’s normal for fire insurance premiums to increase annually 🏠
Apart from ABEX increases, some insurers may choose to raise rates due to profitability issues. The good news in such cases is that you have the right to cancel your policy if you disagree. There will be specific terms and deadlines, but it’s your strict right.
In reality, it’s better for your insurance company to be profitable. Why? Because it ensures their solvency, meaning their ability to compensate you in case of a claim.
I found a really cheap insurance… What pitfalls should I avoid?
Some insurers offer seemingly unbeatable rates, at least for the first year.
It may seem enticing… 🤨
But this isn’t always the case. These insurance companies often raise prices in the second year. Therefore, it’s essential to carefully examine the terms and conditions with each insurer.
However, if these insurance premiums are very low, it’s usually because not all coverages are included. At such prices, they often only cover tenant’s civil liability. Home content, legal protection, and theft are usually not covered! 😱
Imagine you have damages from a fire for which you are responsible 🔥
Your basic coverage, tenant’s liability, only covers your responsibility for damages to the building and movable property belonging to third parties (the owner, neighbors…). Your furniture and electronic devices won’t be covered and thus won’t be reimbursed if you only have this “tenant’s civil liability” coverage, which, by the way, is the only mandatory one in Belgium.
Coverage for your belongings is optional, but strongly recommended. It’s better to opt for more comprehensive insurance that offers proper protection ☝️
And at Flora, how is the cost of my insurance calculated?
At Flora by Ethias, we use a flat-rate calculation method 💰
To calculate your tenant fire insurance premium, we rely on just two criteria:
- The property type: apartment, house (2 or 3 facades), or city (4-facade house)
- The location: the postal code of the area where you live
During enrollment, we also ask for the amount of rent you pay monthly. This information doesn’t factor into calculating your insurance price. It’s what we call a segmentation criterion ☝️
This means that, depending on the amount, we will or won’t agree to insure a property. As a flat-rate insurance, we exclude properties with too high a value and consider the rent amount as reflective of this value.
In the case of a rental, the maximum accepted rent amount is €1,807.92, and for a shared rental, it’s €2,925.41 per month. These amounts change every 6 months as they are also indexed based on ABEX.
At Flora, we’re committed to providing affordable tenant fire insurance for everyone. This way, you get tailored coverage for your property at the best price in Belgium.
Our insurance premiums are considered “cheap” for several reasons:
Our management is 100% digital, speeding up all processes from enrollment to claim reporting 📱
We bypass brokers to avoid additional fees.
This type of management also avoids extra personnel costs. Our team consists of 2 managers, Tom and Denis.
In case of a claim, you’ll need to report it yourself using the mobile app. They won’t take your claim over the phone but will, of course, professionally handle your case and provide support.
If you wish to report a claim over the phone or even in person, it’s better to turn to a broker, bancassurer, or traditional direct player like Ethias, Yuzzu, or Corona Direct.
It can sometimes be difficult to understand what lies behind your insurance premium. Some comparison websites like Comparatif Assurance, Top Compare.be, or Independer can assist you in your choice. How can we explain the disparity in prices offered by each insurance company? You’ve grasped it. Numerous criteria must be considered. The calculation method, intermediary involvement, option choices, and coverage all play a significant role in the cost of tenant fire insurance in Belgium.