A crack appearing in a wall rarely comes “out of nowhere”: the most common explanations are building work on the neighbouring plot, demolition and chiselling by the tradesperson working on your own renovation, or years of vibration from a railway, tram line or busy road running past the house. The first thought in such cases is home insurance – and this is also often where the client meets the first disappointment, because the insurer replies that the damage is not an insured event. As a broker, what I see is that in these cases the money is typically recovered not from your own policy but from the liability of whoever caused the damage, and that the outcome depends largely on what the injured party documented before the crack even appeared. From the perspective of a family house and a flat, this article shows why home insurance typically does not pay, who the damage can be claimed from in the three typical situations, and what the minimum evidence is without which the dispute is decided to the injured party's detriment.
- Home insurance pays for sudden, unexpected events named in the policy conditions; a crack that develops gradually because of building work, demolition or traffic vibration is typically not an insured event under Hungarian policy conditions, because it results from external human activity, not from a natural peril.
- In such cases the damage can be claimed from whoever caused it: with a neighbour's building project, from the party commissioning the work and from the contractor (since January 2025 the law has required contractors to hold liability insurance); with your own renovation, from the tradesperson's liability insurance; with railways and public roads, from the operator – the personal liability section of home insurance typically does not cover the fault of a tradesperson you have hired.
- The key to proof is a condition survey before the building work starts and an independent structural engineer: without them, the “it was already there before” dispute is typically decided to the detriment of the injured party.
Why is a crack not an insured event under most policy conditions?
For the building, home insurance does not pay for “every kind of damage” but for the events named in the policy conditions: fire, storm, escape of water, earthquake, landslide, the collapse of an unknown underground cavity, an external object falling onto the building, impact by an unknown vehicle. What these have in common is that they happen suddenly, unexpectedly and through an external force. A crack, by contrast, is not an event but a consequence, and the insurer's loss adjuster examines what triggered it. If the cause is an excavation pit next door, piling, demolition or traffic vibration – in other words, human activity that acts gradually over weeks or years – it typically falls outside the cover under Hungarian policy conditions: several sets of conditions expressly exclude damage arising from construction, demolition and earthworks, and pay for ground movement only in its named natural forms. Where the line runs between slow subsidence and a landslide is explained in detail in the article on cracks after a drought; the logic described there also applies here, except that the cause is not nature but the activity of an identifiable person or company.
This does not mean that you should leave your own insurer out. It is worth reporting the damage on the insurer's claims line, because classifying it is the insurer's job, and in an exceptional situation – for example, if the wall suddenly sags because the neighbouring foundations have been undermined – one of the named events may come into play, depending on the policy conditions. And the rejection letter is not a failure but a document: in the claim against the liable party, it later proves that your own insurance did not cover the damage. If your contract includes a legal-protection add-on, its conditions may also provide cover for the legal costs of the claim – this varies from insurer to insurer.
Your neighbour is building: the liability of the developer and the contractor
Damage caused by construction next door is covered in separate articles from the perspective of people building and of condominiums, so only the essentials here. Under the general damages rule of the Hungarian Civil Code (Ptk.), whoever unlawfully causes damage to another is liable for it, and the rule on neighbours' rights states that an owner, in using their property, must refrain from unnecessarily disturbing the neighbours and from endangering their rights. In practice, this means that the injured party can turn to the developer (the party commissioning the construction) and to the contractor; which of them is liable and in what proportion depends, in the specific case, on their contract and on how the damage was caused, and in a dispute the court decides. An important new development is that since 15 January 2025, construction contractors have been required by law – Sections 21/B–21/G of Government Decree 191/2009 (IX. 15.) on construction contracting activity – to hold liability insurance, which can provide cover for damage caused by breaching professional rules, including the restoration of a damaged neighbouring property. The injured party is therefore entitled to ask the contractor for the name of its insurer and the policy number, and may also report the damage there; the liability insurer, however, examines the liability of the party that caused the damage, not the mere fact of the damage, so here too it is the injured party who has to prove the damage and the causal link – the party that caused the damage can exonerate itself by proving that it acted as can generally be expected in the given situation.
Your own tradesperson damages the neighbour's property: whose insurance?
The reverse situation, the same logic. If the contractor you hired cracks your neighbour's wall through chiselling, knocking down walls, machine vibration or overloading the floor slab, the contractor is primarily liable for the damage, because it was caused by their own activity; as the client, you may also be approached, especially if the tradesperson cannot be identified or has no cover behind them. Many people trust that in such a case the personal liability section of their home insurance will step in. This cover, however, applies to damage you cause as a private individual – the falling flowerpot, water leaking into someone else's home, the dog – and typically not to damage arising from a contractor's work, and several sets of conditions expressly exclude liability connected with construction and installation work; the details are in the article on personal liability. The practical conclusion is simple: the contract for the works should include the name of the tradesperson's liability insurer and the policy number – as contractor liability insurance has been compulsory since 2025, every contractor working as a business must have one – and for a larger rebuild, the liability section of a construction and erection (contractors' all-risks) insurance can also be a solution. When and why a renovation must also be reported to your own insurer is covered in the article on renovation.
Railway, tram, busy road: the operator's liability
Under home insurance, a crack caused by traffic vibration is no more a sudden event than one caused by building work, so here too the claim is directed at whoever caused it – the railway infrastructure manager, the transport company operating the tram, or the authority managing the public road. Court practice typically treats the operation of a railway as an extra-hazardous activity, for which the operator is liable irrespective of fault and is typically released from liability only if the damage was caused by an unavoidable cause outside the scope of its activity – whether this applies to a particular crack in a house is decided by the court in the specific case, after expert evidence. The difficult point is not the legal basis but the causal link: the vibration has to be measured, the nature and age of the crack have to be assessed by a structural engineer, and the building's own weaknesses – old, shallow foundations, earlier rebuilding, drying clay soil – have to be separated from the external effect. It is harder to hold the railway liable for the cracks in a fifty-year-old outbuilding without foundations than for fresh cracks running perpendicular to the track in a house with proper foundations. It is advisable to notify the operator of the claim in writing, with a description of the damage and photos; several affected neighbours together are in a stronger position to prove their case, and the cost of a joint vibration measurement is also shared. A claim for damages can be enforced within the general five-year limitation period of the Ptk., but a claim based on the rules of liability for extra-hazardous operations becomes time-barred after three years under Section 6:538 of the Ptk. – so for a claim based on railway vibration you need to reckon with this shorter deadline; notifying the operator or sending a demand letter does not in itself interrupt the limitation period.
Condition survey and expert: the key to proof
In all three situations the same question decides the outcome: whether it can be proved that the crack appeared after, and because of, the activity in question. That is why the most important step comes not after the damage but before it. If your neighbour starts building, or you start a renovation, ask for – or prepare – a condition survey: dated photos of every wall and of the façade, with a description of the length and width of existing cracks; for a larger project, a signed report by a structural engineer, and in exceptional cases a notarial certificate of facts, can also be prepared. A careful developer and contractor will initiate this themselves, because it is also in their interest not to be held responsible for old cracks. If the crack has already appeared: photograph it with the date, stick a plaster tell-tale across it or mark its end with a pencil, and check every week whether it is moving; write down when and what kind of work or traffic took place; send a written demand to whoever caused it, specifying the damage; and bring in an independent structural engineer before anyone repairs the wall, because a crack that has been plastered over proves nothing later. If the insurer's loss adjuster rejects the claim, they also record the cause they have established – this document can also be used in the case against the liable party.
What should you do now?
If the crack is fresh: document it, report it to your own insurer on the claims line, and at the same time as reporting it, send a written demand to whoever caused it and ask for the details of the contractor's liability insurer. If your neighbour is only now starting to build, or you are signing with a tradesperson right now, a condition survey and the insurance details written into the contract are worth more than any later dispute. If you are unsure what the liability cover and any legal-protection section of your own home insurance extend to, let me know and I will help where I can – it is, however, you, your expert or your lawyer who pursues the claim against the party that caused the damage.
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Sources
- Hungarian Civil Code (Ptk., Act V of 2013) – the general rule on neighbours' rights, the general rule on liability for damages, and limitation
- Bankmonitor: A new obligation in the construction industry – contractor liability insurance from 2025 (in force from 15 January 2025; restoration of neighbouring property)
- BKIK (Budapest Chamber of Commerce and Industry): Frequently asked questions on compulsory contractor liability insurance (January 2025)
- MABISZ (the Hungarian insurers' association) Home Insurance Guide (20 February 2025) – the basic risks and named events of home insurance
- Government Decree 191/2009 (IX. 15.) on construction contracting activity – Sections 21/B–21/G: compulsory contractor liability insurance (from 15 January 2025)
