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Along with earthquakes, the Government may also make flood insurance mandatory
2026-02-02 16:13:55 / EKONOMI&SOCIALE
Along with earthquakes, the government may also make property insurance against floods mandatory. The Ministry of Finance has submitted to the relevant institutions for consultation the revised draft law "On the mandatory insurance of homes against earthquakes", to which floods are also attached. This is a move directly related to the increased exposure of homes and land to this risk, which caused considerable damage earlier this year.
All citizens are expected to be required to take out earthquake and flood insurance. According to the draft law, the insurance price will not be determined by the market, but will be approved by the Council of Ministers, based on the risk, geographical area and typology of the building. The methodology for calculating the premium will be based on current models developed for Albanian conditions.
Essentially, the new draft aims to build a mandatory financial mechanism to cope with material losses in properties, gradually shifting the emphasis from “after-the-event” response towards risk prevention and management. As in the previous draft, in this version the scheme will be administered by the “National Fund for Mandatory Earthquake and Flood Insurance”.
In the event of a natural disaster, the damages will be assessed by licensed experts, and the compensation payment will be made by the Fund, within the specified deadlines. The compensation will cover material damage to the apartment and the items inside it, but not loss of economic activity or lost profits.
The draft for mandatory earthquake insurance of homes was re-released for public consultation in July 2025, but was not approved by the government last year.
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