Real Estate in Israel

Property Insurance

• Property insurance is designed to insure against fire, rain, snow, hail, break-in, wilful damage and third party liability.
• If you have taken out a mortgage, you are required to insure the property , the policy being written in favour of the mortgage bank. The mortgage bank offers an insurance scheme, which is normally about 10% more expensive than the policies offered by insurance companies, and also does not include third party liability, and contents insurance cannot be included in the policy.
• If you have a mortgage, coverage must also include earthquakes and water damage from broken pipes or installations . Otherwise, earthquake coverage is optional.
• Third party liability is for 500,000 NIS on a standard policy . This amount can be adjusted upwards if required.
• The rate for property insurance including earthquake coverage and third party liability is approximately 150 NIS per 100,000 NIS cover. If earthquake damage is not covered, the premium reduces to 50 NIS per 100,000 NIS.
• Properties are valued for insurance purposes according to the cost of construction, at a rate of $800-$1,000 per sq.m.
• If you are planning leaving the apartment unoccupied for more than 60 continuous days, an additional premium is charged for both property and contents insurance.

Contents Insurance

• Contents insurance is designed to insure against fire, theft, wilful damage, third party liability, employers liability, water damage, all risks coverage for jewellery, TV's, video equipment, home computers, faxes and sound equipment up to 10% of total value of contents, bikes up to 750 NIS per pair, glass surfaces and windows, marble and sanitary ware up to 5% of total value of contents.
• Coverage for all risks for jewellery and electronic equipment in excess of the standard 10% of total contents value can be purchased at a rate of 4% of the excess value in the case of jewellery and 0.80% for electronic equipment. All risk coverage can also be obtained for photographic equipment, cameras, video cameras etc.
• The rate for contents coverage is around 500 NIS per 100,000 NIS value of the contents without earthquake coverage, and 600 NIS if earthquake coverage is included.
• Valuation of contents is made by a licensed assessor, but if you are bringing in a "lift", the insured value of the lift as assessed abroad is sufficient.
• The assessor is also responsible for determining the type of anti-burglary security devices required , which range from bars on the windows and a "multi-lock" front door, through to burglar alarm systems linked to a security company by phone. The level of security required depends on the total value of the contents, the make-up of the contents, the storey the apartment is located on, etc.
• Water damage: You can elect to have water damage fixed by an insurance company approved plumber or by a private plumber of your choice. In the case of a private plumber, the deductible is approximately double the amount for an insurance company approved plumber, but the quality of work is generally better.

Deductible

Whilst varying from company to company in general we are looking at around 400 NIS. There are policies where the deductible reduces if there are no claims on the policy, going down to around 200 NIS after two complete years without a claim. In the case of earthquake coverage, the deductible is 10% of the insured amount.