[Glossary](https://pecuvo.eu/en/glossary/) · Pensions and insurance # Home insurance **In short:** Home insurance is voluntary insurance that covers the building and/or its contents against fire, water damage, theft, natural disasters and other risks named in the contract. **Simply put:** For most families the home is their largest asset. Insurance helps rebuild after a major disaster. What is covered depends entirely on the contract. With a mortgage, the lender usually requires the property to be insured. **Example:** A flat worth €90,000 is insured for €90,000. After a fire the damage is €30,000; the insurer pays it, minus any excess. **Watch out:** Three traps — underinsurance (the sum insured is below the value), exclusions (earthquake or flood are sometimes separate cover), and assuming the bank's policy is the only option. > **Example: Bulgaria** — With a mortgage, the bank must accept a policy from another insurer if the cover is equivalent (Act on Consumer Credit Related to Immovable Property, Art. 12(3) — as explained by the Association of Bulgarian Insurers). > > **Check in your country** — Ask the bank in writing whether you may bring your own policy with equivalent cover. **Source:** Insurance Code (Bulgaria), Art. 389 (in Bulgarian) — https://www.fsc.bg/wp-content/uploads/2021/files/24426_file.pdf · Association of Bulgarian Insurers (in Bulgarian) — https://www.abz.bg/article/moga-li-da-izbera-sam-zastrahovkata-na-imota-pri-kredit-2454 ## In depth in the modules - [Module 12](https://pecuvo.eu/en/modules/insurance/) ## Related terms - [Insurance](https://pecuvo.eu/en/glossary/insurance/) - [Sum insured](https://pecuvo.eu/en/glossary/sum-insured/) - [Policy exclusions](https://pecuvo.eu/en/glossary/policy-exclusions/) - [Mortgage](https://pecuvo.eu/en/glossary/mortgage/) - [Excess](https://pecuvo.eu/en/glossary/excess/)