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What Is Home Insurance Policy? And Its Benefits

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There is nothing like owning your own house, a place where you feel secure and relaxed the most after coming back from your work. But what if in your absence something unfortunate happened like a short circuit creating fire damage, or a natural event like an Earthquake, floods that can destroy your home and all your hard earned money, or thieves damaged and broke into your house?

Without having a home insurance policy, homeowners have to pay for this loss from their pockets and continue living with a fear of such events in the future.

What Does Home Insurance Policy Cover?

All such losses can be prevented just if you have purchased a home insurance policy, home owners can easily prevent such events and risks. Cause buying a home insurance will protect your flat, bungalow, house, apartment, or built house. And also gives you cover for any losses like:

  • Natural Calamities like Earthquakes, Floods, Storms, Hailstorm, etc.
  • Riots, Burglaries, Theft any kind of property destruction.
  • Damages caused in Roadways or Railways Construction.
  • Fire, smoke, or explosions.

Unlike motor vehicle or car insurance policies, home insurance is not mandatory by the government. It is something home owners buy for their own home safety from all the above mentioned threats.

Cost of Home Insurance In India (2024)

In India home insurance policies can cost in a variety of ranges, suppose if you are going for a basic home insurance plan then it is very affordable. And for an annual home insurance of Rs.10,00,000 premium costs around Rs. 2 – Rs. 3 per day.

Cost of Home Insurance policy In India (2024)

While if you are more prone to natural calamities or man made disastrous elements then you should go for more package policy but it costs a bit more but that comes offers a wide range of protections.

If you ever consider buying any of the home insurance policy the annual premium will be more cheaper because of the discounts companies offer.

Benefits of Home Insurance Policy

Every home owner should have a Home Insurance Policy also known as a homeowner’s insurance policy, since it will cover the financial losses.

Benefits of Home Insurance Policy

It is also possible to pay for the damages to your property and belongings in conditions that aren’t controlled by you. The Benefits of a home insurance policy for your home are:

  • You may be eligible for financial assistance to repair or control damage in the event of an unfortunate incident.
  • If a third party is responsible for damage, you may be insured without entering into an legal dispute.
  • It is easier to get a get a home loan for house repair, renovation, or extension if there is property insurance.
  • The cost of losing the contents and belongings of your home can be covered. Things belonging to the home like appliances furniture, furniture and furniture tools, and jewelry.
  • The insurance coverage does not only cover the damages caused by natural disasters or catastrophes, but also for damage caused by theft, robbery, or burglary.
  • There are various kinds that home insurance policies specifically designed to meet specific needs.

These policies cover Landlord’s Insurance or Tenant insurance. The landlord is able to claim insurance of the landlord if it is the case that the tenant (public liability) causes harm.

In addition, if there’s an unintentional loss of the tenant’s payment (rent) due to various reasons. Equally, the tenant could be insured for his/her personal belongings in a flat rented to tenants.

How To Claim Home Insurance?

Filing a home insurance claim can seem to be a bit challenging but it isn’t as it seems. To claim your insurance on your home you might require documentation and proof of loss.

  • Documents like police FIR/investigation report in case of any burglary or theft incident and statements from fire brigades/authorized organizations/residential society.
  • Also, the medical officer’s certification of disability or death and for that you should also go for a health insurance plan when required. Other than that you may require court summons, estimates for repairs or invoice/proof of possession of the items, and so on.
  • You must pay the deductible when you make an insurance claim on your home. The amount of insurance you receive depends on the type of policy you’ve got.

It will depend on whether the policy’s coverage will be dependent on the cash value in actual rupees as well as the value of replacement. The below explanation will help you understand much better:

  • Actual cash value provides the current value of a house or other item. It subtracts the depreciation amount from the value of the item at the time it was brand new. Depreciation is the reduction in value of an item or asset due to the condition and age of that item.
  • The calculation of depreciation can be based on the item insured and the insurance provider.

    Imagine a television set that is insured, but it is stolen or damaged as a result of theft. The insurance amount is the amount of coverage for the price of the television that is based on the value of the TV in the period of claim
  • Replacement value insurance will pay for the actual value of the property or the item. It will give the amount of insurance needed to repair it.
How To Claim Home Insurance policy

Let’s suppose that the damaged or missing TV set is three years old, and the coverage is based on the value of replacement. One can then claim the amount of insurance as the price of the television set when it was at purchase. The insurer will pay the cost of buying or replacing a brand new set with the same specifications to replace the damaged or lost one.

Conclusion

In conclusion, if you have your own home, flat, apartment, or bungalow that you have built from your hard earned money and if you want to protect it from any natural disaster like earthquakes, flood, etc or man made disasters like theft, riots then it is recommended that you should go for a home insurance policy.

As in this blog, we told you about the benefits of a home insurance plan how this would help you in the long run and also about how you can claim home insurance if you caught yourselves in any unfortunate incident.

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