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Insurance for Expats in Malta

Submitted: November 2013

Do not wait for problems to arise before reviewing your insurance arrangements. Once you have a problem, it is already too late. Being poorly insured is risky whereas being over-insured is expensive.

The insurance business is regulated by the Malta Financial Services Authority (MFSA). As Malta endeavours to be a reputable offshore financial centre, one can expect the MFSA to be concerned with financial stability and consumer protection. There is also a consumer complaints service. Nevertheless, it’s still good to check how reliable your insurer is.

There is a wide range of insurance products available in Malta, and it is advisable to shop around and compare before taking out an insurance policy. If you are unclear about your cover or your needs whilst you are in Malta, you might wish to check your existing insurance arrangements in your country of origin. This is important if you want to avoid double coverage.

Insurance isn’t necessarily a country-specific issue, but how much insurance you need may vary from one country to another.

Home insurance

Your home insurance needs depend on whether you own your home, or if you rent it. Home insurance is not a legal requirement in Malta. However, mortgage lenders generally require you to have home insurance.

Discounts may be granted by your insurer if you can prove you have taken some specific steps to improve security, such as having an intruder alarm in place.

Home owners and tenants

Both owner occupiers and tenants may need contents insurance and/or public liability insurance. Contents insurance is designed to insure your belongings for a notional “sum insured”. This amount must really reflect the value of the property you want to insure, not the maximum amount you think you’re at risk to lose.

Should the real value of your total belongings be lower than the sum insured, your insurer will make the corresponding apportionment (“call average”) for any claim, even a small one. Every time a “call average” adjustment is made, the policyholder has to meet part of the costs for himself.

Example

Hans has €20,000 worth of belongings in his home, and he has taken out contents insurance for a sum insured of €10,000.

Later on, Hans is burgled. It is estimated that the criminals have taken away €5,000 worth of belongings.

As Hans is only insured on 50% of his belongings, he can claim no more than €2,500 from his insurer.

In addition, personal liability insurance may be needed. This should cover you against third party liability arising from an accident in your home.

Home owners

If you own your home, you need buildings insurance. This may cover the costs of rebuilding your property from scratch, the costs of certain exceptional repairs. The “sum insurance” described above applies also to buildings insurance.

As for all insurance policies, it is up to you to decide how generous you want your cover to be, what the excess amounts are, which unexpected expenses are covered (e.g. alternative accommodation or legal costs), etc.  You can opt for an “all risks included” policy or just select certain risks, such as personal liability only.

Going away from home

If you expect to be away from your home for more than one month, you should let your insurer know. Failure to do so may result in a claim being rejected if something happens to your home whilst you are away.

Home insurance exclusions

Check if something is excluded from your home insurance policy.

Car insurance

Under the Motor Vehicles Insurance (Third-Party Risks) Ordinance, you must have car insurance to drive a car in Malta. This should insure you against potential liabilities for third party bodily injury or property damage, but not damage or theft of your own car. Failure to have adequate insurance may attract a fine.

If you need your vehicle to have more than just third party cover, you might wish to take out a comprehensive vehicle insurance policy.

Health insurance

Most expatriates will need private health insurance, at least until they register with the Entitlement Unit of the Department of Health. See HEALTHCARE – Health Insurance for Expats in Malta.

Regarding health insurance, expatriates may take out an international cover from an insurer in their home country. International covers tend to be more expensive, but they are straightforward and they can spare you the need to have separate insurance policies (i.e. one in your home country and one in Malta). Expats who frequently move across borders are more likely to need an international cover to achieve peace of mind.

Life insurance

Life insurance can be particularly helpful if your family is financially very dependent on you, as it may guarantee a lump sum payment to your family if you die. Businesses may also need life insurance to reduce the risks of losing a key individual.

Do assess carefully the burden of retaining foreign life insurance while you are resident in the Malta. Do also check the geographical extent of your existing life insurance policy when you move across borders.

 

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