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The government will take action against unjustified price increases in all cases, and therefore welcomes the fact that, following banks and telecommunications companies, insurance companies are also voluntarily limiting and freezing home insurance premiums. According to a statement by the Ministry of National Economy, a significant increase in home insurance premiums was expected, which would have placed a considerable additional burden on Hungarian families.
The Ministry of National Economy had already initiated consultations with players in the insurance sector. They asked insurance companies to follow the example of the banking sector and telecommunications service providers and voluntarily commit to price caps and premium reductions. If the negotiations had not been successful, the government was ready to intervene in the pricing of home insurance with regulatory measures, the Ministry recalled.
They confirmed that in recent days, insurance companies have announced voluntary fee restrictions one after another. The government welcomes the fact that insurers have accepted the government’s objective and are taking action against unjustified price increases in the interests of families.
Like banks, the Hungarian insurance sector is on stable footing, which allows for a reduction in home insurance premiums, while insurance amounts will continue to follow the increase in property values in order to avoid underinsurance.
As a result, despite the premium reduction, there will be no deterioration in the quality of services provided.
According to their announcements, insurers have voluntarily undertaken that the premium levels for new home insurance contracts concluded by the general public will not exceed the premium levels applicable on December 31, 2024, under unchanged conditions, and they will maintain this commitment until June 30, 2026.
In addition, all customers with existing contracts will receive a discount, and the insurance premiums paid by customers will not increase during the one-year period starting on the anniversary date of their contract between July 1, 2025, and June 30, 2026.
In summary, the government’s action will provide tangible assistance to more than three million Hungarian families, totaling approximately HUF 15-25 billion (EUR 37-61.6 million). As a result of the voluntary commitments made by insurance companies, home insurance customers will be exempt from the effects of 12 months of inflation on their insurance premiums, while the value of their insured home assets will increase, thus preventing underinsurance. The government’s objective is clear: in the interests of Hungarian families, home insurance should be widely available and its costs should remain fair and affordable, the Ministry emphasized.
Via MTI, Featured photo via Pixabay
