Compulsory home insurance in 2026: Prices, closing steps and huge fines for those without PAD
Regardless of whether you live in an urban or rural environment, as a homeowner you have a legal obligation to insure your home against natural disasters. This compulsory insurance is called PAD (natural disaster insurance policy) for short and covers damage caused by earthquakes, floods and landslides. Not having such a policy not only exposes you financially in the event of a disaster, but also constitutes a violation of the law
All homeowners are required to take out home insurance policies
PAD is the mandatory home insurance policy against natural disasters, established by Law no. 260/2008. It is issued by the Natural Disaster Insurance Pool (PAID Romania) – a body specially created to manage this system – and applies to all homes in Romania, whether in rural or urban areas, owned by individuals or legal entities. Basically, PAD is the first level of protection for your home in case of natural disasters.
This policy strictly covers three major risks stipulated by law: earthquake, flood (natural phenomena) and landslide. Other perils such as fire, theft or storms are not included – these can be insured separately through optional (optional) policies. The maximum amount compensated by PAD, in the event of a disaster, is 100,000 lei for a type A home and 50,000 lei for a type B home. Type A includes buildings with a solid resistance structure (reinforced concrete, burnt brick, stone, etc.), and type B refers to constructions made of traditional materials not subject to treatments (for example, adobe). Regardless of the event, the compensation will not exceed these ceilings (100,000 or 50,000 lei), and the risks covered are only the three mentioned.
What fines can be applied
According to the law, all owners of houses and apartments in Romania – individuals or legal entities – are obliged to conclude PAD insurance for the homes they own. This legal obligation applies regardless of the environment in which the home is located (urban or rural) and regardless of whether the property is used as a permanent residence, holiday home or rented. If you own a home, you must have a valid PAD policy – it's both a civic responsibility and an express requirement of the law.
Failure to comply with this obligation constitutes a misdemeanor, that is, a violation of the law. In practical terms, this means that you can be fined (according to the law, between 100 and 500 lei) for not having the mandatory insurance. Town halls, through the local police, are tasked with checking that owners have insured their homes and imposing sanctions on those who have not complied. Therefore, the obligation to conclude the PAD is not optional or symbolic, but is imposed by law, with control mechanisms and penalties in case of non-compliance (we will detail the fines at risk and how they are applied).
How much does a PAD policy cost and how does it end?
One of the major advantages of PAD insurance is the affordable cost, established by law. The insurance premium (annual premium) has a fixed value: 130 lei per year for a type A home and 50 lei per year for a type B home. These rates are updated in lei (the values were increased in 2023, from 20 euros and 10 euros, respectively, to the current level in lei) and are very small in relation to the benefits offered. Basically, for almost 11 lei per month (in the case of type A homes) or just over 4 lei per month (type B), you protect your home for a considerable insured amount (100,000/50,000 lei) against the three most devastating natural calamities. The PAD policy is concluded for a period of 12 months and then must be renewed annually to remain covered.
The compulsory policy is issued in the name of PAID, but can be bought through almost any authorized insurance company or through insurance brokers – most general insurance companies mediate PAD, having the status of a PAID partner. You also have the convenient option of concluding the insurance online: for example, PAID Romania provides a portal where you can make your PAD directly, and insurance platforms such as asurigarari.ro allow you to obtain the offer and the policy quickly, without traveling. You only need the identity document and the building data (address, area, etc.), and the premium payment can be made instantly online or through the bank. The policy is usually effective immediately or the day after it is issued, so there is not a long waiting period.
It is important to know that PAD insurance does not replace optional home insurance, but complements it. PAD covers only the basic risks (natural disasters), while an optional home policy covers a wider range of risks (fire, explosion, theft, flooding from facilities, landslides not covered by PAD, third party liability, theft of household goods, etc.). To take out standard optional insurance, you must first have a valid PAD policy – in practice, many companies will not offer you optional insurance if you have not met the compulsory insurance obligation.
