Every year we make sure to renew our vehicle and health insurance. But unfortunately, we often tend to ignore one of the most important insurances- Home Insurance. Last year, ICICI Lombard conducted a survey which brought forth certain shocking revelations. As per the survey, nearly 93 per cent respondents did not have a home insurance policy. However, what was more shocking was the fact that out of the total respondents, 62 per cent were aware about the benefits of an insurance policy.
Shocking, isn’t it? Now, one of the major reasons cited for not owning a home insurance was the cost factor. Thus, to promote awareness about this important subject, National Housing Bank (NHB) is working on an agenda with the Insurance Institute of India that could reduce home loan rates by about half a percent if borrowers opt for an insurance cover. Now, this is already a common practice as a few housing finance companies offer property insurance to borrowers taking home loans.
“The magical thing about home is that it feels good to leave, and it feels even better to come back.” These lines by Wendy Wunder holds true for all of us! People who have survived earthquakes, flash floods, massive fires or landslides are true evidence of how a home can be destroyed or damaged in just a matter of few seconds. Now, the impact of natural disasters can be reduced to some extent if you have a home insurance.
So, what does a basic home insurance policy covers? The home insurance usually has two parts-one that covers the structure and the second that covers the household valuables such as electronic appliances and furniture. Also, depending on the insurance, one can get cover for fire and allied perils, including lightening, storm and flood, and earthquake. One can also get insured against burglary, damage, and mechanical or electrical breakdown.
Points to Remember
Here are a few points to remember while opting for a home insurance policy.
- One of the most common myths that people usually have is that low premium equals to low insurance cover. However, the cost of premium can be reduced if you select a home insurance policy that suits your needs well. Thus, before finalising one, do compare policies offered by different companies. It will also give you a holistic picture of what is available in the market.
- Do not buy unnecessary add-ons. For instance, if you are staying in peaceful area, in all the probability, terrorism cover may not be useful for you!
- Home insurance can generally be taken for a minimum of one year to a maximum of five years. Make sure to renew your policy once it expires!
- Read the terms and conditions of the policy carefully.
Did you Know?
Tenants can also purchase a home insurance policy. But since it is a rented property, one can just get the contents (valuables) insured and not the structure. And in case, you plan to shift your rented home, you can just get the address change in the policy for it to become relevant for your new abode!