What to contemplate when shopping for home insurance – Mint

Home insurance ensures that you remain financially stable in the event of damage to your property or valuables inside. Hence, it is always advisable to insure your home.

Choosing the right home insurance can be overwhelming for home buyers as there are several factors to consider. However, there are a few facets that you need to know before choosing one.

Understand home insurance and what it covers

Household contents insurance is a type of property insurance that provides protection against unforeseen loss or damage to the structure of the house and its contents. Homeowners (for their own house) and tenants who live in a rented house can take out household insurance.

Rakesh Jain, Chief Executive Officer, Reliance General Insurance Co. Ltd, said, “There are two types of insurance coverage in India. The building insurance covers damage caused by structural damage to the house caused by natural disasters such as earthquakes and floods. And home insurance covers loss or damage to home items such as electronics, jewelry, furniture, etc. ”However, the coverage required will depend on a number of factors. These factors also affect the policy premium.

Residence: Where you live makes a huge difference in determining the type of coverage you need. For example, if your home is near the ocean, you need protection for your electronic equipment, which is easily damaged by corrosion. Likewise, a region at risk of natural disasters is often affected by earthquakes, cyclones or floods. In this case, you need to ensure that structural and substantive damage is covered.

Type of house: Insurance coverage changes depending on the home you insure. Whether it is an apartment, plot of land, bungalow or rental property, insurance coverage can differ from one another, as different risk factors are associated with each type of house. In this way, the use of your property will determine the premium as the use of the building directly affects the type of risk that may be associated with the building. In general, the premium is higher for commercial buildings such as offices, factories or warehouses.

Age of the property: If the building is old, then apartments in these buildings are considered to be the most susceptible to damage and loss. In such a case, the insurer can charge a high premium. For example, damage caused by a fire in your apartment due to a short circuit in the old power line can cost expensive repairs and the old building has to be rebuilt.

Replacement value vs. loss deduction: According to the new value cover, the insurer makes a payment that is sufficient to replace the damaged items with new ones. However, the insurer makes the payment in other variants after deducting the depreciation. In this way, the costs of the last-mentioned home insurance are comparatively lower.

Give your insurer the right information: When applying for insurance, it is very important to provide details of your property and contents. For example, the insurer can use the height / floor of the property, the exact development area, the building / floor plan, the number of household appliances, information on valuables including jewelry to assess the right insurance coverage for your home insurance and offer the best protection. Providing false or misleading information can create stress during a claim.

Find out about the exclusions in your policy: It is important to know what your home insurance does not cover. Jain said many insurance policies list certain types of damage they don't cover, such as: B. willful destruction of property, loss and damage from war, volcanic eruptions, seepage and contamination damage.

"If there are any exclusions that you would like to have in your home insurance, you will need to get supplemental insurance if available," added Jain.

Available add-ons: Comprehensive household contents insurance in conjunction with supplementary insurance tailored to your needs is all you need to insure your dream home well. Supplementary insurance will help you in areas where your standard home insurance may not cover. “Some of the supplementary insurances include protection for portable electronic equipment such as cameras, audiovisual equipment, diagnostic and medical equipment, jewelry and valuables protection, terrorism protection, rental loss protection. In addition, you can protect your premises against break-ins and break-ins with specially developed supplementary insurance, ”says Jain. So take these factors into account when choosing suitable home insurance.

Required documents for the complaint procedure: When filing a claim, it is important to remember that providing insufficient or incorrect information could result in your claims being delayed or rejected. Duly completed damage form, building plan, initial information report (FIR) or fire department report in the event of theft or loss, invoices / receipts, KYC documents, canceled check for receiving the damage amount electronically are some of the documents that you may need depending on the type of claim . This also ensures a smooth complaint process.

Take away mint

Buying a home can be one of the most significant investments of your life. And with uncertainty growing, getting home insurance becomes a future investment that can protect you from significant financial setbacks.

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