It is the dream of majority of Indian folk to buy a house, and it is the single largest and costliest investment that anyone makes in their lifetime. After you purchase a beautiful house, it’s important that you give a complete protection to your assets against any unfortunate incidents. Catastrophic events such as a fire accident, cyclone, flood, earthquake and burglary can throw you in the most difficult situation of your life. In such circumstances, having a house insurance can spare you from the horror of rebuilding your house all over again or getting a refund for the valuable items lost.
Majority of the people in the country do not give much importance to home insurance. They feel it’s a waste of money as these do not get any returns if the tenure gets completed. Though this is very much like a term insurance, the importance of having a home insurance should not be neglected at any cost. Following reasons will help you understand why a house insurance is mandatory for everyone in India.
Natural Calamities are Inevitable
Living in India, you must be well informed about its geography and demographic details. It is estimated that 68% of India’s land is prone to draught, 60% to earthquake, 12% to floods, and 8% to cyclones. A sudden natural calamity has the power to wipe out your entire home and leave you penniless. At such circumstances, a home insurance can save you from the biggest trouble of recovering the losses.
Additional Reading: 5 Compelling Reasons for You to Buy Home Insurance
A Comprehensive Protection Beyond Your Home
Many assume that a home insurance covers just the building against the calamities. But apart from natural and man-made disasters, you can get liability coverage against personal injuries, third-party injuries (guests) and damage. Moreover, you have the option to cover all the content in your house, such as electronics, furniture, appliances, garage, shed, fence, etc.
Replacement for the Loss can Save Your Earnings
When your property gets suddenly damaged by any unfortunate event like natural calamities or theft, an emotional and financial stress are inevitable. To recover from the loss, you might have to shell out your hard earnings. A house insurance can spare you from such horror and get you replacement for all the lost or damaged items. Staying protected with a home insurance ensures that you get immediate relief from any such unforeseen incidents.
Low Premium, Larger Benefits
A house insurance acts more like a term insurance. You can claim the coverage only within the tenure of the insurance. Once the policy expires, your house insurance becomes invalid for making any claim. However, you can still renew the policy. As the insured do not get any returns upon maturity, a house insurance comes with low premiums. A home insurance can be cheaper than a car insurance. It starts from minimum of Rs. 250 per month on a property worth Rs. 50 Lakhs.
Home Insurance for Tenants
It might come as a surprise to many that there is a home insurance scheme for tenants as well. Natural disasters, fire explosions, theft, electrical breakdown, man-made hazards, accidental damage, etc. are covered under this house insurance for tenants. The insured can get the cover up to Rs. 10 Lakhs for all the content in the house. The maximum amount can vary depending on the insurance policy.
Additional Riders in Home Insurance
A rider is an add-on to your standard insurance policy. While taking a home insurance, you can also opt for additional coverage based on your suitability. To pay a lower premium, many may ignore the additional riders and just stick to the standard policy. An additional rider can get you extra benefits. Personal properties such as jewellery, antiques, fire arms, collectibles, paintings, etc., can be covered in an additional rider. Losses caused by theft and living expenses due to damage and personal accidents within the premise of the house come under additional coverage in a home insurance.
Easy Loan Availability
While approving loans and credit cards, some of the lenders give preference to candidates who have taken a home insurance. There are chances to get low interest rate on your loan as well. For the lenders, a home insurance is an indicator that you are responsible with your financial activities.
Protection from Lawsuits
Some home insurance policies provide the owner protection against property-related lawsuits. For example, if there is a man-made hazard or damage done on your property, the insurance policy covers all the expenses involved in carrying out the lawsuits.
Things That Are Not Included In A Home Insurance
Each home insurance policy differs as per rules set by the insurance providers. Some features may not be covered by one policy but may come under an additional rider in another home insurance policy. Hence, it is important that check for all benefits while taking an insurance policy. Following are the things that are generally not covered in a home insurance.
- Loss or damage due to war: Situations such as war, invasion and terrorist attack can cause damage to one’s property. Loss or damage due to such unforeseen incidents are not covered in a home insurance by most of the insurers.
- Jewels: Some insurers do not cover precious jewels, bullions, gold coins under a home insurance. However, some insurance companies provide additional rider to cover such losses.
- Usual Wear & Tear: A home will generally have usual wear and tear situations where it will require maintenance and renovation. Expenses incurred from such activities will not be covered under a home insurance.
- Under Construction Property: A home insurance is purely provided for the residence where you live currently. Any new construction raised within the premise will not be covered.
- Wilful Misconduct: Any loss or damage caused because of one’s wilful misconduct will not be considered for claiming the home insurance.
End Note
A home insurance is a pro-active measure to safeguard your property and probable damage or loss due any unexpected misfortunes. Staying protected with the home insurance can offer you a peace of mind from going through the horror of unexpected loss.