Building and Life Insurance

A list of products available to you through Bulgarian Home Loans

There are two main types of insurance that you will need to protect your Bulgarian purchase. These are buildings insurance and life insurance.

Building Insurance

Under Bulgarian Law only the owner of a property stated on the Notary Act may insure it. It is therefore not possible for the developer or the property management company to hold a buildings wide insurance policy as is common in Western Europe. It is the responsibility of each owner to ensure they have adequate insurance cover.

The borrower is required to provide proof of buildings insurance cover for the security property before drawdown of the loan. The minimum risks covered must be fire and allied perils, flood and earthquake. The bank’s interests must be noted on the insurance and we will need to confirm that the annual premium has been paid and that a copy of the certificate is sent to the bank.

The insurance companies that are likely to be used are Allianz Insurance or Interamerican Bulgaria. We shall provide more details as they come available.

The cost for this service is 50 euros which will be added to you annual insurance premium.

Personal Insurance

Personal Insurance to cover you and your Bulgarian Property

Whether you are taking out borrowing in the U.K. or further a field it is essential that you are able to meet the repayments when things don’t quite go to plan.

It is common in Bulgaria that once people have three months arrears the property is very quickly repossessed by the lender.  This is even the case when a person dies, the lender still wants their money and penalties for non payment can be very severe.  It is also important that your cover is in place from the moment you sign the preliminary contract, as if you die it’s unlikely your family will have any deposits returned!

There are three main types of insurance:

• Life Insurance – paying out a lump sum if you die (usually the necessary amount to pay off your mortgage).
• Critical Illness Insurance – paying out a lump sum on diagnosis of a critical illness (usually the necessary amount to pay off your mortgage).
• Income Protection – Paying a monthly amount if you unable to work due to illness.

Obviously the better the cover you have the more expensive it is. Do not simply always opt for the cheapest cover, make sure you think about what you and your family would do if the worst did happen.

In order for us to give you an idea of the type of cover and cost you must complete and return the ‘insurance questionnaire’:

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As soon as possible and certainly before a full application is submitted.

For arranging the necessary personal insurances, we refer to our sister company, Simplicity Financial Services Ltd (an independent FSA regulated mortgage brokerage).  We have attached a copy of their personal protection guide that will give you more details on the different types of insurance available, an initial disclosure document explaining their service, and a flyer giving further details.