One of the most alarming letters a homeowner or tenant can receive comes not from their own insurer but from their neighbour's: “We have compensated our client's loss; under the Civil Code (Ptk.) we are asserting a claim for reimbursement against you, and ask you to pay within … days.” The damage occurred at your neighbour's, your neighbour has received the money – and yet you are the addressee. This is recourse (regressz), the insurer's claim for reimbursement, and in Hungarian practice it is becoming increasingly common after leaks into the flat below, fires that spread and damage caused by tenants. The good news: in most cases this is exactly what the liability cover of your own home insurance is for. The bad news: only if you have it, and only if you report it in time. This article takes you from the letter to the close of the case.
- Recourse is neither a mistake nor harassment: under Section 6:468 of the Hungarian Civil Code (Ptk.), the insurer has a claim for reimbursement against the person who caused the damage, up to the amount of damage it has paid – the upstairs neighbour, the tenant or whoever caused the damage through negligence pays the amount out of their own pocket if there is nothing to pay in their place.
- What pays in their place is your own personal liability cover – so the letter should not be paid but reported to your own insurer; the insurer examines whether you are liable at all and pays the justified part in accordance with the contract.
- Liability cover is not unlimited either: for damage caused intentionally or through gross negligence the insurer may be exempted from paying (the burden of proof is on the insurer), a tenant is protected only if they have tenant's liability cover, and there is no recourse against a relative living in the same household.
Where does the right of recourse come from?
Section 6:468 of the Hungarian Civil Code (Ptk.) reads: “The insurer shall be entitled to a claim for reimbursement against the person who caused the damage, up to the amount of the damage it has paid, unless the person who caused the damage is a relative living in the same household as the insured person.” The logic is simple: the injured party's own home insurance pays the neighbour's damage under the contract, but this does not make the liability of the person who caused the damage disappear – it passes to the insurer, which claims the amount paid from whoever caused the damage. A 2024 decision of the Kúria (Hungary's supreme court; Gfv.VI.30.304/2024/8.) also drew the boundary: the insurer may reclaim only what it was obliged to pay under its contract; if it voluntarily paid for an excluded risk, recourse does not extend to that. The basis of recourse is therefore twofold in every case: an actual and lawful payment by the injured party's insurer, and your liability for damages under Section 6:519 of the Civil Code – anyone who unlawfully causes damage to another is obliged to compensate for it, unless they prove that their conduct was not blameworthy.
This second element is the most important: a recourse letter is not yet a judgment. The insurer claims that you are liable; it has to prove this. With a leak, the question is typically where the fault was – in the section inside the flat, whose maintenance is the occupant's task, or in the condominium's common pipework, for which the condominium is responsible. The article on leaks into the neighbour's flat and the article on flats in prefabricated blocks describe the boundary between the riser and the section inside the flat. A sudden pipe burst that could not have been foreseen through maintenance is not necessarily blameworthy; a siphon that has been dripping for years and was reported but not repaired is all the more so.
What protects you: personal liability cover
The liability cover of home insurance – a mandatory element of the basic package of the MNB's Certified Consumer-Friendly Home Insurance – is there to relieve you, in the manner and to the extent set out in the contract, of paying compensation for damage that you are obliged by law to pay. Recourse is exactly such a claim, only it is brought not by the injured party but by the injured party's insurer. The article on personal liability insurance details the scope of the cover – as property owner, as tenant, the members of the household, pets; here I only highlight the points that matter for recourse. Liability cover pays justified claims, up to the limit and after deducting any deductible; defending against an unfounded claim is also the insurer's job, in its own procedure. In addition to the damage covered by the recourse claim, the injured party may also claim directly from you the part not paid by their own insurer – the deductible, depreciation, any amount above the limit; this too is a matter for your liability cover.
The protection has limits. Under Section 6:464 of the Civil Code, the insurer may be exempted from paying if it proves that the damage was caused unlawfully, through intentional or grossly negligent conduct – the burden of proof is on the insurer, and the conditions fill in the concept with examples: a circumstance likely to cause damage that was not remedied despite the insurer's written request, a recurring identical cause. This is an exemption, not an exclusion: the liability remains, only the insurer does not pay in your place. The second limit is the absence of a contract: a tenant without tenant's liability cover cannot rely on the landlord's insurance – the landlord's insurer may, where applicable, take recourse precisely against the tenant; that is why the article for tenants puts tenant's liability cover first. The third is the relatives exception: the insurer cannot take recourse against a relative living in the same household as the injured party – so damage caused in your own home by your own child or spouse is not such a case.
What should you do with the letter?
First: do not pay, and do not sign any statement acknowledging liability or the amount. An acknowledgement is not a condition of payment, but it makes it harder for your own insurer to defend the claim; according to a lawyer's answer from 2025, the party receiving the demand should consult their own insurer. Second: report the letter to your own home insurer as a liability claim without delay after receiving it – the conditions typically set a short deadline for reporting claims made against you, and under Section 6:453 of the Civil Code a delay has consequences if, as a result, material circumstances can no longer be established. Third: ask the insurer seeking recourse for the basis of its claim calculation – the inspection report, the calculation, the amount paid – and pass it on to your own insurer. Fourth: gather everything that supports you on the question of liability – a plumber's invoice on the nature of the fault, proof of earlier maintenance, a statement from the condominium's common representative on the pipe section, photos. Fifth: tell the insurer seeking recourse, in factual terms, that you have reported the case to your own liability insurer, and direct further communication there.
If you have no liability cover, the situation is different: a justified claim has to be paid from your own assets. Even then it is worth checking the amount and the liability item by item, asking for payment in instalments and, in a dispute – bearing in mind the general five-year limitation period and the court route – seeking legal help; legal-protection insurance provides a lawyer paid by the insurer for such cases. As a broker I do not represent you in a claim and I do not hold talks with the insurer; if a case gets stuck or disputed, I help where I can: in comparing the policy conditions with the letter and in putting the notification together, acting on your instructions.
What should you do now, before anything happens?
Check on your policy whether you have liability cover, with what limit, whom it covers, and whether it includes your capacity as tenant or landlord if your situation requires this. Maintain the pipes, siphons and flexible hoses inside your flat – this not only prevents water damage in your own home but is also the strongest argument on the question of blameworthiness. And if the letter does arrive one day: not payment, but a report to your own insurer – that is the order.
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Sources
- Hungarian Civil Code (Ptk.) Section 6:468 (the insurer's claim for reimbursement), Section 6:519 (liability), Section 6:464 (exemption), Section 6:453 (notification) – Act V of 2013
- Kúria (Hungary's supreme court) Gfv.VI.30.304/2024/8. – scope of the insurer's claim for reimbursement
- Generali general property insurance conditions – exemption, claim for reimbursement (Chapters X and XII)
- MNB (Hungary's central bank and financial supervisor): Certified Consumer-Friendly Home Insurance – liability insurance in the basic package
- Hóvége – dr. Cecília Kajó: I flooded my neighbour – what happens now? (January 2025)
- Financial Arbitration Board (PBT, MNB)
