Cantonal Building Insurance
Cantonal building insurance is a public-law insurance institution that holds a statutory monopoly on natural hazard insurance for buildings in a number of Swiss cantons.
Comparison profile
- Trigger
- Named perils
- Insured interest
- The building's replacement value against fire and natural hazard damage, insured with the cantonal monopoly institution in monopoly cantons.
- Rating basis
- Insured building value (replacement value) as fixed by the cantonal institution, Building category and cantonal risk zone, Cantonal premium rate (non-profit-oriented)
- Typical limits
- Sum insured normally set at full replacement value by the cantonal institution; supplementary private cover can extend beyond the statutory scope.
- Typical deductibles
- Modest statutory deductible per cantonal tariff, generally lower than under a comparable private all-risks building policy.
- Target segments
- Private homeowners, Real estate investors, Institutional property owners
Insured events
- Fire and explosion
- Flood and inundation
- Storm and hail
- Avalanche and landslide
- Earthquake (only in some cantons, via the intercantonal pool)
Key exclusions
- War and civil unrest
- Wear and tear and gradual deterioration
- Perils outside the statutory catalogue: water escape, glass breakage, liability
- Nuclear energy
- Losses excluded under cantonal law (e.g. deliberate act)
Compulsory insurance
- CH: compulsory via the cantonal monopoly institution in 19 of 26 cantons (fire and natural hazards)
- CH: compulsory by cantonal law but privately insured in Uri, Schwyz, and Obwalden
- CH: voluntary in Geneva, Ticino, Valais, and most of Appenzell Innerrhoden
Concept
Cantonal building insurance is a public-law institution holding a statutory monopoly on insuring buildings against fire and natural hazard losses (flood, storm, hail, avalanche, landslide, etc.) in 19 of the 26 Swiss cantons. In the remaining cantons (including Geneva, Valais, Ticino, Uri, Appenzell Innerrhoden, and Schwyz), a free market exists in which private insurers offer building insurance.
Structure of the Monopoly
In monopoly cantons, virtually all buildings must be mandatorily insured against natural hazards with the respective cantonal institution; these institutions generally set the sum insured based on replacement value and charge risk-adjusted, but non-profit-oriented, premiums. Several institutions have joined together within the Intercantonal Reinsurance Association (IRV) to jointly absorb major natural hazard events.
Relevance for Insurance Practice
Property owners in monopoly cantons have no choice of building insurer for the basic coverage; supplementary coverages (e.g. building liability, glass breakage, water damage beyond the basic offering) can nevertheless often still be arranged with private insurers or as add-on coverage from the cantonal institution. For intermediaries, understanding the respective cantonal system is essential when advising on residential property.
Comparison and delineation
Cantonal building insurance and homeowners building insurance are effectively alternatives determined by jurisdiction rather than by choice: in the 19 monopoly cantons, property owners must insure with the cantonal institution, while in Geneva, Ticino, Valais, Appenzell Innerrhoden, and (privately) Uri, Schwyz, and Obwalden, cover is placed with a private insurer offering broader homeowners building wordings. Even where the cantonal monopoly applies, its scope is limited by law to fire and natural hazard perils; supplementary covers such as building liability or glass breakage are typically arranged separately with private insurers or as an add-on module offered by the cantonal institution itself.