The Insurance and Private Pension Regulation and Supervision Authority (SEDDK) has published a circular clarifying the scope of fire insurance and how coverage and premium amounts should be displayed in policies.
The circular, dated 1 October 2026, states, “Regardless of the name under which it is issued, fire insurance refers to insurance issued subject to the General Conditions of Fire Insurance, where the main coverage consists of covering the direct material damages caused by fire, lightning, explosion, or smoke, steam, and heat arising from fire and explosion to insured movable and immovable property.
“In cases where liability towards the neighbours of the insured due to fire and explosion risks, as well as the liability regarding the damages of the tenant if the insured is the property owner, or the damages of the property owner if the insured is the tenant, are secured, the portion of such liability coverages related to the fire and explosion risk shall also be evaluated within the scope of fire insurance.”
In addition, the circular says that risks that can be covered by an additional contract or rider are coverages separate and independent from the main fire insurance coverage. The inclusion of these risks together with the main coverage in the fire insurance policy does not mean that these risks are included in the scope of the main fire insurance coverage.
The new regulation aims to minimise disputes stemming from different interpretations, which have led to a loss of time and resources for municipalities, judicial authorities and insurance companies.
Premiums and guarantees will be shown separately.
In addition, SEDDK stipulates that the coverage amount for each risk secured under riders, and the total premium amount for all these coverages, will be shown separately from the coverage and premium amounts for the main fire insurance coverage.
Insurance companies will also transmit the coverage and premium amounts for each risk secured by a rider to the Insurance Information and Monitoring Centre (SBM) simultaneously with data on premiums. The companies' information systems will include recording and control mechanisms that ensure the consistency of the information in the policies with SBM records.
Effective date
The provisions of the circular regarding the separate display of additional coverages and premiums in fire insurance policies, and the provisions regulating data transfer to SBM, will enter into force on 1 January 2027. The other provisions entered into force on 1 October 2026, the date of the publication of the circular.