A friend had a leak in his apartment that caused damage in the apartment below. The apartment has a mortgage, and it seems that mortgages come with insurance which covers burst pipes (less a substantial deductible). But when the insurance company was asked if they also pay to repair the apartment below, the person on the phone didn't know if this policy covered "third-party damages". In the meantime the apartment owner got a form from the insurance that he has to sign and return before he gets his partial refund on the repairs, in which he agrees that he has no further claims.

So my questions are
1) is third-party damages part of the standard policy that you get with a mortgage?
2) if it is, will signing the form allow the company to get out of paying?

Experiences regarding similar situations outside of Israel, or not involving the insurance that comes with an Israeli mortgage may not be relevant, which is why I put this in the Aliya section rather than the Advice section.

thanks