Introduction
Let’s start this guide by asking yourself: what is your most valuable asset? The answer for most of us is our home. Our house not only provides us with a place to stay, but it is our most expensive property – ranging from a few hundred thousand rupees to a few crores.
However, most homeowners do not invest in their home. It is common for individuals to insure their car (because it is legal) but not insure their home. In fact, most people do not consider their home as a risk. Contrary to popular belief, housing is threatened across the country. The number of fires, burglaries, and thefts recorded each year range from a few thousand to hundreds of thousands. Also, in recent times, we have seen natural calamities affecting lives and property in different parts of India. Floods, cyclones and even earthquakes – there are many things that can happen to your home. National statistics show that nearly 48 lakh Indians experience natural disasters every year, which cause property damage of over Rs. 64,000 crores. Much of northern and western India is prone to earthquakes, putting more than 200 million people in 100 cities at risk. This is where homeowners insurance comes in. Homeowners insurance is an insurance policy that protects you from financial damage when you lose a significant amount of your life’s assets in a natural or man-made disaster. Here in this guide, we explain everything about home insurance – what it is, types, why you need it, how to choose the right home insurance, FAQ and more.
What is home insurance?
Home is where the heart is and a home insurance policy helps you protect it. Home insurance is known by many names: home insurance, property insurance, home insurance or home insurance. This is an insurance policy that helps protect your home against damage due to the insurance program (specific items) mentioned in your policy. Some of the things that are commonly covered include fire, flood, storm, earthquake, etc.
If your home is damaged due to a disaster mentioned in the policy, the insurance company will give you a lump sum to pay for the repair or replacement of the damage in your home. Additionally, a home insurance policy also protects you from legal fees if a guest is injured while visiting your home.
The condition of the roof provides protection
There are many situations and situations where home insurance protects you. Here are some key situations where it can help you:
1. Repair or rebuild a home after a disaster
Standard home insurance provides you with a sum of money to repair or rebuild your home in the event of natural or man-made calamities such as lightning, floods, storms, cyclones, fires, riots and others. .
The amount of coverage depends on the premium and plan you choose. The sum insured is calculated based on several factors such as:
Renovation value – the cost of building a home. This does not include the cost of land. Agreed value – the total value of the property, agreed by the insurer and the insured.
Debt value – this is the cost of construction minus the cost of debt. 2. Replace or repair the damaged device
When you take out comprehensive home insurance, the policy also protects your home and its contents from electrical/mechanical damage, theft and burglary. To be eligible for this benefit, you must declare the value of all insurance items in your home at the time of application. You must keep a copy of all bills and invoices of the insured. Depending on the premium and policy you have chosen, the sum insured will be calculated after taking into account amortization. The insurer may reimburse the cost of replacing the damaged goods or pay you a lump sum for the repair costs. 3. Temporary migration
Sometimes, especially during natural disasters, your home can be seriously damaged. In such a case, you and your family members must seek temporary housing until your home can be repaired or rebuilt.
The insurance provider covers your temporary accommodation as a rental until your accommodation is ready to be restored. 4. Load protection
Home insurance policies provide load protection. This means that if a guest in your home is injured on your property, you will have to pay for the guest’s injuries. With home insurance, the insurer is responsible for the reimbursement of third-party costs following an accident that occurs on your property. 4. Higher chances of home loan approval
If you are looking to qualify for a home loan to build your dream property, your lender can approve your home loan application if you approve your home. Home insurance acts as a financial safety net for the lender, providing financial stability in the event of unexpected loss or damage to your property.
6. Loss of rent
This is another type of insurance that you can buy alongside your standard home insurance. If your property becomes uninhabitable following repairs or a claim, the insurer pays you for the loss of income due to the loss of the home. Loan insurance is available until your home is rebuilt or repaired.
7. Personal Accident Insurance
Some home insurance policies also offer accident and disability coverage. If you have an accident with an insured home, you may be eligible for personal accident coverage from the insurer.
Who should take out home insurance?
There is a common myth that home insurance is only for homeowners. Unlike this, home insurance policies are for everyone, whether you own a home or live in a rental property. Let’s use an example to explain why. Take the case of Rakesh, who moved into a rented house in Gurgaon a few months ago. He built his house with many high quality materials and spent a few lakhs on the interior. A few weeks ago, there was a fire in his house, which caused all the inmates to lose their tools and other things in the house.
Fortunately, Rakesh has taken out a home insurance policy for his rented house. Under the plan, the insurer reimburses the cost of all damaged appliances, furniture and furnishings. Rakesh can move his family to another house and use the money to pay for the new place. Therefore, his home insurance coverage protected him from financial stress during the accident. As you can see, home insurance provides security and peace of mind for both homeowners and tenants. So, home insurance is perfect for everyone.
Top 5 Benefits of De-cluttering
There is no denying that home insurance provides great financial protection to all homeowners. Here are the top five benefits you can get when buying home insurance:
Complete coverage of your belongings in the home and the layout of the home.
Protect your most cherished asset – your home – against natural and man-made disasters. Costs for home insurance are lower than for other insurance plans.
Paying bills on time and with high coverage helps you and your family move or repair and rebuild your home quickly after a disaster. It helps you get back to your daily life after an accident.
Above all, it gives you a lot of peace. You can reduce your stress and anxiety, knowing that your home is always protected.