Basics of insuring your homeBy: Kavita Sriram, TNN
To own a house is every individual’s dream come true. The house could have taken away your life’s savings or you may have to repay the debt for decades.
There is so much at stake when it comes to the safety of your house. Have you considered insuring this precious possession of yours?
What is home insurance?
When it comes to your house, it holds not only economic but also tremendous emotional bonding. The possibility of damage to your house cannot be ruled out. Home insurance tries to preserve the safety of your valued house. It protects it from unforeseen eventualities that can cause damage. A home insurance policy covers the structure and contents of your home from natural to man-made calamities. It also comes with additional features like protection for the family, loss of cash in transit and baggage loss.
Home insurance comes with two-fold protection, one for structure and another for content. Structure cover is a comprehensive cover that envelopes the construction of the house including its walls, roof and the flooring. Content cover protects all the contents and belongings within the house. It provides insurance for all the expensive jewelry and cash at home.
What are the issues covered?
Fire is a major catastrophe damages the structure and its contents. A home insurance policy provides protection from fire and such disasters that are can prove very expensive. The contents of the house should be insured for their market value. The building cost is equated to the cost of reconstruction today.
There are other perils against which this insurance protects your home. It includes explosion or implosion , aircraft damage caused by aircraft, damage/loss due to riot, damage due to impact by rail or road vehicle or animal , bursting/overflowing of water tanks, apparatus and pipes, leakage from automatic sprinkler installations, lightning and bush fire, loss caused by storm, landslide etc.
What are optionally covered?
The home insurance needs can be diverse and can be tailor-made to suit various needs of home owners. On payment of extra premium you can extend the umbrella of cover to include additional benefits. You can include burglary, loss/damage of domestic appliance, personal accident and baggage loss, public or third party liability, plate glass, etc.
Typically, not included under the cover is willful destruction of property; loss, damage or destruction caused by war; wear and tear and atmospheric conditions etc.
How are payments made?
You have the option to either choose a comprehensive cover or separate cover. Under a comprehensive cover, all the sections are to be covered. The more sections you take for additional cover, the more discount you get on the premium.
This policy can be taken for a period of five or ten years. The longer the term of the policy, the more the discount on premium. The premium is usually paid every year.
How do you make claims?
In order to get the claims process rolling, submit to the insurer a completely filled and signed claim form, copy of the policy, copy of FIR, report from police and a copy of all invoices, bills, price listing and estimated copy of repairs.
Intimate the insurer. The insurer then transfers your request to the claims department . And the insurer authenticates and settles your claim within a stipulated time frame.
Some points to bear in mind
Give an accurate value of whatever you want to insure. You may need to pay higher premium, but all your valuables will be amply covered. In the case of appliances, ornaments and items in the house, provide the insurer with list of things including the model number, name of manufacturer, year of purchase, value, and other specifications .
This will ensure that your claim at a later date is not unnecessarily rejected. Verify if your cover makes up for the replacement value of your valuables.