Cyprus Insurance

We would not advise our members to buy a new Cyprus property without employing the services of an insurance broker. Remember that there are other forms of insurance that you will need to consider when moving to Cyprus or anywhere abroad for that matter.

We were amazed at the number of people who we talked to who either had no insurance at all or who thought they had some. Some had arranged insurance without knowing what cover they had. The documents are often in a language they could not read, so it's no surprise.

Insurance is something that all should take seriously.

Are you aware that:

- If you purchase a property as an investment in Cyprus or anywhere abroad and rent it out you will need public liability insurance. Such cover is not automatically provided in a standard property insurance policy in Cyprus.
- If you allow friends to use your property you are still liable to a claim if something awful happens.
- If you employ a cleaner to clean your property you will need employers liability insurance.
- If you rent your property to a U.K. citizen and he has an accident he can sue you in the U.K.

Even if it means that you will pay a higher premium your property should be covered for all eventualities via earthquake, burst pipes, fire, flooding, act of God, etc.

Take special care of the socalled exclusion changes. Some policies for example exclude damage as a result of bush fire - this will be excluded unless you include it. Excluded is also earthquake, volcanic eruption or other convulsion of notice; damage occasion by or through or in consequence directly or indirectly of acts of terrorism committed by a person or persons acting on behalf of or in connection with any organization "terrorism" for the purpose of this exclusion means the use of violence for potential ends and includes any use of violence for the purpose of putting the public or any section of the public in fear; damage caused by any road vehicle or animal belonging to or under the control of the insured or any occupier of the premise or their respective employees.

Of special mention is the unoccupancy period of the property in Cyprus. If your property in Cyprus is not occupied for a certain period of time continuously your policy will not cover you unless this term is included in the policy.

You also need to differentiate between the replacement cost of your Cyprus property and the actual value of the property. It's always advisable to insure your Cyprus property on replacement coast. This will cover all costs of rebuilding the property albeit on the principle that the rebuild is based on the same materials and qualities etc.

Your replacement cost should be based on the actual cost and do not attempt to reduce the premium by estimating a lower cost. If you insure the replacement coast at CYP £ 70 000 but the actual cost is CYP £ 100 000 you will only be paid 70% of the replacement cost. If on the other hand you over insure you will only be paid the actual cost.

In the case of the property forming part of a bigger project special attention needs to be paid to the insurance. In such instances it is imperative that a blanket comprehensive insurance be taken over the entire project taking into account the common areas, parking areas, lifts etc. and the premium be paid as part of the common expenses. This will afford you the protection and you are assured that all apartments are insured and that your property will be rebuilt in the event of a calamity.

Finally your valuation should be updated every two to three years obtaining a new valuation by a qualifying valuer and don't rely on the historical costs.

The following are also to be noted:

- Your policy can be voidable by the insurance company in the event of misrepresentation, misdeception or non-disclosure by you.
- Your insurance can cease if the nature of the occupation of or other circumstance affecting the building insured or containing their property insured be changed in such a way as to increase the risk of damage by any of the perils issued. (You need to notify the insurance company of any such change immediately the change takes place.)
- Your insurance can also cease if the property insured is removed to any building or place other than that in which it is insured.
- You are required to maintain the property insured in a proper state of repair and take all reasonable precautions to prevent damage thereto.

Also remember that in the event of any occurrence which may give rise to a claim:

- Take all reasonable steps to minimize any loss or damage
- Recover any missing property
- Immediately report to the police any loss or damage due to riot or malicious acts
- Notify the insurance company as soon as possible, giving full particulars of the occurrence
- Submit the written claim as provided and within the time period set out in your policy

Bear in mind that:

- All benefits under the policy will be forfeited if any claim made is in any respect fraudulent or if any fraudulent means or devices are used by the insured or anyone acting on his behalf to obtain a benefit under the policy or if any damage is caused by the willful act or with the connivance of the insured.
- The insurance company may at its option repair or replace the property damaged or destroyed instead of paying the amount of the loss or the damage. If the company elects to repair or replace any property the insured may be obliged at his own expense to furnish the company with such plans, specifications, measurements, quantities and such other particulars as the company may require.
- Where the insured item consists of articles in a pair or set the insurance company will not pay more than the value of any particular part or parts which may be lost, destroyed or damaged without reference to any special value which such article or articles may have as part of such pair.
- If the property insured at the time of any damage be corrective of greater value than the sum insured, the insured will bear a share of the loss corresponding directly to the proportion of under insurance.
- The policy will invariable include an arbitration clause.
- In any action, suit or other proceeding where the insurance company alleges that by reason of an exclusion clause any loss or damage is not covered by your policy the burden of proving that such loss or damage is covered rests upon the insured.

- In the case of public liability insurance, the insurance company shall not be held liable in respect of:

- Liability assumed by the insured under any agreement.
- Injury to any person arising out of and in the course of the employment of such person by the insured under a contract of service.
- Fines, penalties punitive or exemplary damages.
- Injury, loss or damage caused by or arising out of the ownership, possession or use by or on behalf of the insured of any mechanically propelled vehicle.

IN THE EVENT OF ANY CLAIM DO NOT PAY OR AGREE TO PAY ANY MONEY OR MAKE ANY ADMISSION OF LIABILITY WITHOUT THE PRIOR WRITTEN CONSENT OF YOUR INSURANCE COMPANY. YOUR INSURANCE COMPANY SHOULD CONDUCT ALL NEGOTIATIONS AND PROCEEDINGS WHICH MAY ARISE IN RESPECT OF ANY CLAIM AND THE SETTLEMENT THEREOF.

DDT Cyprus Insurance

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