Since 15 January 2025, liability insurance has been a legal requirement for construction contractors, and one question has kept coming up in the FAQs of the chambers of commerce ever since: “I have had business liability insurance for years – will that do?” The regional chambers give the same answer: the existing contract must be reviewed with the insurer, because old policies were designed for the business's own risk needs, not for the substantive requirements of the decree. As a broker, I see that very different content lies behind the name “business liability insurance”: some policies cover only the activity carried out at the business premises, some exclude subcontractors or restitution for violation of personality rights (sérelemdíj), and some have a limit that does not even reach the decree's lowest band. This typically comes to light not when the contract is taken out, but at the chamber check or when a claim arises. Who the obligation applies to, from when and with what minimum is summarised in the earlier article; this piece is about how to check your existing contract on five points.
- According to the chambers' FAQs, an existing contract must be reviewed with the insurer: an old “business liability insurance” policy does not automatically meet Sections 21/B–21/G of Government Decree 191/2009.
- Five points to check: the insured activity, the types of damage and restitution (sérelemdíj), the subcontractor extension, the per-loss-event and annual limits for your own revenue band, and the identity of the insured and the content of the certificate.
- If any of them is missing, the contract must be amended or a new one concluded; the chamber looks only at the uploaded document and, if something is missing, can prohibit the activity for up to six months.
1. The insured activity: does it include the work you actually carry out?
The decree requires the contractor to have liability insurance covering the compensation of “damage caused in the course of the construction work it has undertaken”. The first question is therefore not the limit but the policy's list of activities: does it contain exactly the activities that you have registered in the chamber's register and actually carry out in practice? Old contracts are often written for a narrower trade – building services installation, for example – while the business has since also taken on general contracting, demolition or building construction. If the list is incomplete, damage caused in the course of a missing activity is not an insured event, regardless of whether the chamber accepted the certificate. The typical gaps of businesses that carry out several activities are discussed in more detail in the article on the list of activities. It is also worth checking whether the contract is written specifically as construction contractor's liability insurance or as general operational liability insurance: for the chamber upload, the certificate of cover must prove the construction activity, and insurers word this differently.
2. Types of damage: personal injury, property damage – and restitution (sérelemdíj)
Under Section 21/B of the decree, the cover must extend to personal injury and property damage, and to the restitution (sérelemdíj) due for non-pecuniary harm involving personal injury in connection with such damage. Hungarian policy conditions typically cover personal injury and property damage; restitution is where old contracts can fall short: on older policies it may be missing, excluded or subject to a separate, lower sub-limit – this varies from insurer to insurer. Look at the “insured event” and “exclusions” chapters of the policy conditions and search for the word sérelemdíj; if you cannot find it, ask the insurer for a written position. The article on restitution (sérelemdíj) explains the background to the concept. According to chamber guidance, the decree does not require cover for pure financial losses – such as the client's lost profit; this is therefore a question of sizing, not of compliance.
3. Subcontractor extension – even if you have no subcontractor today
Under the decree, the cover must also extend to damage arising from the activities of employees, persons in other work-related legal relationships and subcontractors for which the insured contractor is liable. This is the most common compliance shortcoming: some Hungarian policy conditions exclude damage caused by subcontractors by default and add it only as an extension for an additional premium – on old policies this extension is often missing, because when the contract was taken out “there was no need for it”. For the chamber check, however, what matters is not whether you are working with a subcontractor at the moment, but whether the contract includes the extension. The article on extensions for an additional premium explains how these adjustable elements work. Two things are worth keeping apart: the subcontractor extension covers your own liability for damage caused by your subcontractors; it does not fulfil the subcontractor's own obligation – that is the subject of a separate question in the FAQ.
4. Limits: per loss event and per year, according to your own revenue band
Section 21/D of the decree links the minimum to annual net revenue from construction work – for sole traders, to net income in the previous calendar year: according to chamber guidance, for revenue of up to HUF 100 million, HUF 20 million per loss event and HUF 40 million per year; between HUF 100 and 500 million, HUF 50 and 100 million; between HUF 500 million and 2 billion, HUF 100 and 200 million; between HUF 2 and 10 billion, HUF 150 and 300 million; above HUF 10 billion, HUF 200 and 400 million. Check both figures on the policy – the per-loss-event limit and the annual limit – because some old contracts state only a single combined amount, or the annual limit is the same as the per-loss-event limit. Also check whether the limit applies specifically to the construction activity, or is the shared aggregate of a contract covering several activities that claims from the other activities also use up – in the latter case it is worth asking the insurer to show the cover allocated to construction clearly on the certificate. If your revenue moved into a different band over the past year, under Section 21/D(3) of the decree you must initiate the amendment of the contract with the insurer with effect from the policy's renewal date, and provide new data to the chamber. The article on minimum limits discusses the difference between the minimum and the real risk – a chain of water leaks in a block of flats or a personal injury can easily exceed the lowest band.
5. Who is the insured, and what does the certificate show?
The chamber accepts what can be seen on the uploaded document. Check that your business – company name and tax number, or for a sole trader the registration number – appears on the policy as an insured; if the contract was taken out by someone else, for example the main contractor, then according to the chamber FAQ you must be named as an insured. The MKIK (Hungarian Chamber of Commerce and Industry) accepts a certificate of cover or a policy no more than 30 days old that proves revenue-based cover, so the limit and the activity must also be legible on the certificate. Check the term of the contract, too: with a fixed-term or project-based contract, a new document must be uploaded after expiry, and the insurer itself also reports the termination to the chamber. The article on certificates of cover gives a detailed picture of what a certificate of cover contains and how to request one. Uploading to the portal of the chamber's contractor register (KIVREG) with an Ügyfélkapu+ login (the Hungarian government's secure online identification) is the contractor's own task – according to chamber guidance, it is done by the person authorised to represent the business, using their own login, and the chamber does not process policies sent by e-mail.
If a point does not check out: amendment or a new contract?
There are two routes. An amendment of the existing contract – adding an activity, a subcontractor extension, a higher limit – can also be requested during the policy year; for this, the insurer asks for new disclosure and typically a premium adjustment, and not all policy conditions allow the extension needed. If the old contract is structurally unsuitable, a new contract is needed, and then the order of the switch matters: cancel the old one only once the new contract's cover has already started, so that not a single day is left without cover – the details are discussed in the article on switching insurers. For situations close to the renewal date, some chamber guidance recommends uploading the document of the existing contract and then updating it after the amendment. The chamber checks the amount of cover corresponding to the revenue stated in the revenue declaration; if this is missing or insufficient, under Section 37 of the decree it prohibits the activity until the contract is concluded, for no more than six months, and then removes the contractor from the register.
What should you do now?
Get out the policy, the policy conditions and the latest certificate of cover, and go through the five points: list of activities, types of damage and restitution (sérelemdíj), subcontractor extension, the two limits for your own band, the insured and the certificate. Ask the insurer in writing about anything that is unclear – the chamber FAQ, too, names a review by the insurer as the first step. If you let me know, I prepare the comparison of your existing contract with the requirements of the decree and, where necessary, the requests to insurers for the amendment or for new quotes; the revenue declaration, the signature and the KIVREG upload remain with you. The insurer pays only for what is an insured event under your contract – and the chamber accepts only what can be read on the uploaded document.
A question tailored to your own contractor's policy? Book a free 20-minute consultation →
Sources
- Government Decree 191/2009 (IX. 15.), Sections 21/B–21/G and 37 (njt.hu)
- MKIK (Hungarian Chamber of Commerce and Industry) – On compulsory contractor's liability insurance
- MKIK – Construction contractor businesses: frequently asked questions
- Pécs-Baranya Chamber of Commerce and Industry – Contractor registration, frequently asked questions
- Sopron Chamber of Commerce and Industry – Contractor's liability insurance FAQ 2.0
- Győr-Moson-Sopron County Chamber of Commerce and Industry – Checks of compulsory contractor's liability insurance have begun (bands, documents)
- Építési jog – Everything there is to know about compulsory liability insurance for contractors
