“Do we have to take out insurance?” – one of the most common questions, and the answer is rarely simple. There is no general insurance requirement that applies to every company; but there are pockets of obligation, from three different sources.
- A law or professional chamber requires liability insurance for certain activities – the scope depends on the activity, under whatever rules are in force at the time.
- The second source is contractual: a client, landlord, tender or lender expects cover.
- Compulsory motor liability insurance is its own world: the law obliges the vehicle's keeper.
When a law or chamber requires it
Practising a number of professions and activities in Hungary requires liability insurance – typically where a mistake could cause significant damage to someone else. Exactly which activities this applies to, and with what limits, is set out in the laws and chamber regulations in force for that activity at any given time – which is why we deliberately do not publish a list here: an outdated list is worse than no list at all. The practical route: check the requirements of your own professional chamber or licensing authority – I help with this during the needs assessment. Details in the articles on compulsory liability insurance and professional chamber requirements; the in-depth content lives on felelosseg.biz.
When a contract makes it mandatory
The second source isn't the law, it's business: the client expects liability insurance in the contract, the landlord expects insurance on the leased premises, the tender expects project cover, the bank or leasing company expects property insurance on the asset. Legally these expectations are "only" contractual – but in business terms they are just as mandatory: without them there is no contract, no tender, no financing. Details: certificates of insurance for partners and tenders and public procurement.
The separate world of vehicles
MTPL is the only insurance obligation that applies to every vehicle keeper regardless of activity – mandatory professional liability insurance, by contrast, is tied to specific activities, but rests on legislation just the same. Above a handful of vehicles, fleet management is the practical route: vehicle fleet overview.
And what isn't mandatory, just sensible
Obligation is a poor compass: it only marks the minimum, not what's actually needed. Practically nothing requires on-site property insurance – yet its absence is what most often finishes companies off after a fire or a water damage claim. The right question, then, isn't "what's required?" but "how large a loss can the company absorb on its own?" The portfolio review answers that question.
Want to go deeper?
This article is deliberately an overview: the detailed information – covers, exclusions, practical examples – lives on the area's own specialist site.
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