Home insurance is a type of property assurance that covers a private residence. This is also commonly called homeowner’s insurance. This contract of assurance may cover liability for damage to the home, damage to the contents of the home, loss of other personal property of the homeowner, and accidents.
Why is home insurance important?
Home insurance provides financial protection against disasters. A standard home assurance policy insures the items kept inside the house. A homeowner’s policy is a multi-line insurance policy, meaning it includes both property insurance and liability coverage with one undivided premium. Combining both property insurance and liability coverage with a single premium means a single premium is paid for all risks. Therefore, this insurance covers the damage to one’s property and injuries caused to the owner or his family members. This insurance contract may also cover damage caused by household pets.
What is the total cost of home insurance?
The cost of home insurance for a homeowner depends on factors such as how much it will cost to replace the home? What is the price of the house? And what features are included in the policy? Many people are often confused about the fact that only the homeowner can get insurance for the house. While this is not at all the case, apart from homeowners, tenants can also buy home assurance contracts to protect their homes from any accidents.
As a cover, insurance companies reimburse the estimated amount under the policy contract which is the total amount which the company arrives at after factoring in the value of the asset based on key determinants. These include the exact location of the area, the area over which the property is spread, the quality of materials used in construction and facilities.
Loss covered under home insurance
Home insurance contracts in most countries other than India cover loss due to natural calamities such as storm, lightning, cyclone, earthquake, flood, avalanche, tsunami, landslide, fire and antisocial incidents such as theft, riots, looting and terrorist attacks. Covers. This insurance policy will help in rebuilding your property by providing cover against such disasters through reimbursement. There are many types of home cover policies currently available that provide specific cover and protection at a reasonable payment as per your convenience.
What types of damages does home insurance not cover?
The property also suffers certain types of damages which are not covered by the home insurance policy. As an insured, you must be aware of these disadvantages. A home assurance contract only covers the construction cost of your home. So this means that this policy will not reimburse you for the entire value of your home. Let us know about such losses which are not covered in home assurance policy:
- Situation of fire due to excessive operation of electronic equipment.
- Situation of damage to your property due to ongoing war between two countries or foreign enemies.
- Due to natural wear and tear of the house.
- Damage to items not covered under insurance.
- Damage caused by pets.
- Situation of loss of cash, antiques and collectibles during theft and robbery.
- Damage to a property under construction or to a vacant property.
- Willful destruction of property.
How many types of home insurance policies are there?
At present, many types of home insurance policy packages are available in the market for homeowners and shopkeepers. Some of these policies are explained below.
- Standard Fire and Special Risks Policy
- home structure assurance
- public liability coverage
- personal accident
- theft and burglary insurance
- contents insurance
- renters insurance
- homeowner’s insurance
What things should be kept in mind while buying home insurance?
Always choose your insurance keeping in mind the topographical challenges of your residential location. For example, seaside property always needs cover against tsunami and cyclone. Similarly, houses in earthquake prone areas require cover against earthquakes. Read the policy documents thoroughly and understand whether they match your needs?
Most insurance companies may try to complicate a clause in the contract to deny you relief or reduce your benefits. In such a situation, you must have proper information about the insurance product. If any disaster has happened to your house, inform the home insurance company without wasting any time. Mention all the items in the house while purchasing the insurance policy as the value of the items which you have not mentioned will not be reimbursed.
Questions asked at the time of home insurance
Home Insurance.
No, both home assurance and home loan are completely different products.
No, you cannot claim ‘tax’ deduction on the premium paid on home assurance.