All about Home Insurance in India
What is Home Insurance?
As it is rightly said, “Home is not a place, it’s a feeling”. No doubt you have seen the best places in the world, but the home is the only place where your heart lies. Most of the people invest their entire hard-earned money in building their dream home no matter how big or small it may be. Hence, it is very vital to protect this beautiful dream with an optimum insurance plan to protect it from threats, man-made or/and natural calamities, etc.
Since “Prevention is better than cure”, it is must to stay protected with a plan rather than getting bankrupted during any unforeseen situation.
The home insurance plan offers complete coverage against monetary liabilities incurred due to loss or damage of your home and/or its contents caused due to natural and man-made perils.
Key Benefits of Home Insurance
Home Insurance has various advantages, making it a wise pick to protect your home against unpredictable situations/calamities. Few of these benefits are listed below:
• Covers household contents
• Secures your assets from any misfortune
• Offers comprehensive coverage to contents of the home
• Reduces your stress during unforeseen situations
• Comparatively lower premiums than other insurance policies
• Timely insurance payouts help family with the quick rebuilding process
• Offers flexibility to choose between best plans for your home
• Covers fire, burglary and other perils
• Online options with fewer documentations
Who Should Buy Home Insurance?
A home insurance plan is a must under several situations for a homeowner. One such instance is that if the owner of the house has mortgage, then the company who is funding this mortgage will ensure that whether your house is insured or not before lending any money. This is because the lender wants to assure that its financial investment in your house is protected in case of any risks or perils. The homeowner can buy such policies online through web aggregators, insurance brokers, insurance company’s website etc.
More than the physical structure of your house, this plan covers the attached space to your house for example deck or a garage. Also, if you or any of your family members are found legally responsible for accidentally damaging someone else property then the liability coverage might help pay legal fees, repair costs and other medical expenses.
Being a tenant, it is obvious that the landlord won’t cover your personal belongings. In addition to this, the tenant is supposed to pay for any damages that occur accidentally to the property. For instance, if there is a short circuit at your house which spreads the fire to your neighboring houses as well, then indeed you are the one who needs to pay the loss/damage.
Also, home insurance for tenants covers both content coverage and liability coverage. Under this, the content coverage deals with replacement or repair of loss/damaged possessions whereas the liability coverage protects tenants if you or any guests cause any damage to the building.
Simple Guide to Buying Home Insurance
In order to protect the homes, people have been investing in home insurance plans for years to ensure that the home they build from the hard-earned money is insured if some unfortunate calamities come up. However, there is seen an increase in the number of insurers providing vast range of plans, hence it becomes really very difficult to select the right one. As you scroll down, you would find a simple guide that will help you to buy an optimum home insurance plan.
• Look for a policy that offers you comprehensive coverage against different calamities. This can be achieved by comparing the coverage and premium of the various policies online
• Always consider the cost of deductibles charged with the policy while considering the premium amount charged by a particular policy
• Check for the review or feedbacks of the customers of the insurer
• Look for the claim settlement turnaround time, customer services provided by the insurer
• If you are not very familiar with the technology or are unable to understand the policy, you need not worry. You can consult a reliable insurance agent that can help you figure out the best suitability plan for you
• Also, while you are collecting quotes from different insurers, do ensure that you take more information about the plan from your current insurer as well
• Ensure that you are clear with all your requirements pertaining to the coverage you need
• While comparing the various policies online, check for the amount of the premiums as it will be a part of your future expenses
• See to it that whether your insurer assures quick settlements
• Get more information about how you can cancel or renew a home insurance policy
An ideal home insurance plan can cover all the financial setbacks during any unforeseen situations. Besides the basic coverage that this plan offers, there are several add-on covers that one must opt for. This extended protection is like a cherry to the cake as it provides enhanced protection in case of unfortunate events such as natural calamities, fire, burglary and other perils.
Following are the add-on covers that can be added to your policy to enhance your plan coverage:
Temporary resettlement cover
Due to any unforeseen events such as fire, heavy floods or any other man-made or natural perils, your house might be completely damaged and would be unfit for stay. In such situation, you will be needed to shift to temporary accommodation. Under this cover, your policy indemnifies you for the expenses related to transportation, packing and other cost associated with alternative accommodation.
Loss of rent cover
This cover is ideal for homeowners who have rented their house to the tenants. Under this cover, the homeowner would be covered for the loss of rent due to any calamities that make the house unfit for staying. Here, the insured would get the indemnified amount until the house is ready and safe for living.
ATM withdrawal robbery cover
This cover is an apt choice owing to the increasing theft and burglary occurring at ATMs. Under this cover, it reimburses you with the amount you lost in case you get robbed instantly after the money is withdrawn from the ATM machine.
Lost wallet cover
If your wallet gets stolen or lost, this cover will help you to reimburse the loss incurred. Also, the reimbursement includes the replacement cost of the wallet, cash present in the wallet, cost of other important documents.
Dog insurance cover
In case your dog dies due to an accident or disease during the policy period, then this cover can insure your dog.
Key and lock replacement cover
This cover is perfect for both homeowners as well as tenants. It provides coverage for the loss or theft of your vehicle keys, loss or theft of the keys of your home and reimbursement of the cost of a locksmith for making new keys (for home and vehicles).
Employee’s compensation cover
If you come across any unfortunate situation which leads to severe injury during the term of your employment then this cover compensates for the injured insured person.
Public liability cover
If your property gets damaged or someone gets injured in your place of residence, then this add-on cover will reimburse for the cost of repairs arising because of the damage.
How to File a Home Insurance Claim?
Every insurer has its own deadlines within which the insured can inform the insurer about the loss. This deadline can vary from 7 to 15 days depending on the insurer you have opted for. Since the time duration is limited, it is wise to inform the insurer as soon as possible. There are various insurance companies which offer the flexibility of informing via email or through SMS.
You need to lodge an FIR and submit its copy to the insurer for filing a claim. Apart from this, documents such as repair estimates, fire brigade report, medical officer’s certificate for death or disability, investigation report by police, suppliers original invoice for replacement, invoice of own articles and court summons needs to be submitted.
Note: The document requirement may vary from insurer to insurer
Inclusions and Exclusions of Home Insurance
Theft and burglary:
A home insurance policy protects your house by insuring the losses incurred due to theft & burglary.
The policy also covers this natural calamity and offers coverage to the insured property if lost or damaged.
Fire and perils:
Protects against damages caused due to aircraft damage, fire, lightning, missile testing operations etc
Offers coverage for damage caused due to electrical breakdown of the insured electronic appliances.
Safeguards your belongings from damages caused during the riot, strike or any other malicious act.
Any kind of war
The loss or damages caused due to wars, invasion etc are not covered under this plan
Loss of precious collectibles le coins, stamps etc are not covered under this plan
Losses due to willful misbehavior
Any losses that are done to the property willfully will not be covered under this plan
Any object which has aged over 10 years will not be covered under this plan
Damages or losses caused due to third party construction does not fall under the coverage of this plan
Tips to Lower your Home Insurance Premium
Did you know that you can lower the cost of the premium for your home insurance plan?
Yes, you can!!! Scroll down to see the top efficient tips that can bring down your home insurance premiums.
• Opt for more than one covers as this will make you eligible for the various discounts
• Agree to share the burden of repair; this will help reduce your liability and also reduce the value of the premium
• Do not insure the contents of your house which are more than 10 years old. There is no point in insuring such old contents, so see to it that you make a proper list of products you wish to insure
• Installing safety equipment at your home can make you eligible to get discounted premiums.
• If your building has round the clock fire safety alarms then you are also eligible for the discounts on your premiums
1. How to choose the sum insured for home insurance?
There are various components that would help in deciding the sum insured one must opt for while buying home insurance plan. Due any unforeseen situation such as fire, windstorm or any kind of natural/manmade perils, your home insurance plan must be capable enough to cover all the losses. So before thinking about the insured amount you must consider factors such as the structure of the house, materials used to build the house, garage, deck or front porch attached to your house etc. Ensure that your coverage should be equal to the replacement cost of your house. Also, it is wise to have enough coverage for your personal property in order to get your belongings replaced in case of damage or loss.
2. What is the average cost of homeowner’s insurance?
The home Insurance premium in India depends completely on the coverage you choose. For instance, if you are opting only for fire and burglary cover, then it should not cost more than Rs.200/ lakh of sum insured. On the other hand, if you want cover for both breakdown and cover for jewelry as well then the cost of the premium would probably go up to Rs. 1000/ lakh type.
It is essential for one to look not only at the benefits or cost of the insurance but also consider the value it offers. Talking about the fire insurance policy, one should consider buying it for a home in India. Also, add on with some other policy for other requirements.
3. What is the best home insurance?
There are different insurers who offer this type of policy and each of this plan have their own set of specialty. However, summing over few parameters the Home Insurance plan offered by HDFC ERGO is an ideal pick as it not only covers the structure of your home but also assures safety for all the belongings and possessions.
This plan is a perfect pick as it offers coverage up to 5 years and also offers discount up to 25% along with an additional discount for security features. Apart from this, the plan comes with a unique cover for homeowners with long term coverage and ensures easy and seamless process owing to its instant online policy.
The plan covers a wide range of risks against earthquake, strike, terrorism, theft, burglary, larceny, explosion, implosion, flood, fire, lightning, larceny etc.
4. Who has the cheapest home insurance?
The cost of the home insurance plan depends on various factors such as the coverage or add-on cover you have opted for, the sum insured which you have selected, etc. The cost of the premiums of the various companies differs from one to another. You can compare the plan online by listing down your requirements and add-on covers, this way you can find the best plan that suits your requirement and your budget.
5. How do you insure your home?
You can insure your home with a comprehensive home insurance plan which protects your home and its content against different types of threats and risks. Buying this kind of policy will help you in avoiding monetary liabilities and at the same time ensure no stress
6. What are Standard Fire and Special Perils Policy?
This is one of the traditional covers that offer coverage against fire or allied perils whichever are mentioned in the policy. This plan covers right from the plinth and foundation of the building to the stocks, furniture, fixtures, fittings etc.
The standard cover would offer coverage for fire, aircraft damage, bush fire, bursting and/or overflow of water tank apparatus, pipes, leakage from the automatic sprinkler installation, missile testing operation, landslide/rockslide, explosion, implosion, lightning, other natural perils etc.
Some of the add-on covers for this policy include forest fire, start-up expenses, spontaneous combustion, debris removal, additional expenses on rent for alternative accommodation, spoilage material damage, leakage and contamination cover, earthquake etc.