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Your home is perhaps the most valued possession in your life. It is essential to take all precautions to protect this valuable asset. Sophisticated locks, police verification of domestic servants, electronic alarms, fire extinguishers in rooms are some of the precautions one has to take at all times. But are these visible forms of security enough to secure your home?
Despite the best security and fire protection systems, thefts do take place, fires still cause irreparable losses. But what about natural calamities like earthquake, floods or breakdown of domestic appliances like air conditioner, fridge etc due to voltage fluctuations. Insurance can play a vital role to make good such financial losses.
Unfortunately, home insurance is hardly a priority for most people. While you choose the best durable, appliance or the best d?cor for your home, when it comes to securing your home there is perceptible apathy.
Loans have led to a growth in home insurance
Home loans have led to a growth in home insurance purely due to banks' insistence and most customers leave the insurance decision to them. If you have decided to protect your prized possessions, then you should devote at least half-an-hour to understand what it covers and what it does not, the cost involved and what will have to be done in case of loss.
A householder's package insures homes against fire and allied perils and it has sections on several risks to choose according to one's risk perception. There are also pre-underwritten options for cover and premium to choose from.
All policies cover earthquake while terrorism is optional. Householders' package is a single policy that covers all major risks associated with a home and its contents like jewellery, electronic items, TV, refrigerator, fragile items like glass plates along with loss of baggage, personal accident and public liability against losses arising out of fire, burglary, theft.
Householders' insurance needs closer examination
However, householders' insurance needs closer examination. Though it offers various covers, it is not compulsory to opt for all of them. However, if you opt for more than four sections, you can get discounts. Some of factors that you should keep in mind are as follows:
1. An important issue is valuation. It is common for home-loan providers to insist on insurance for the loan amount, which is not right. What needs to be accounted for is the cost of construction, excluding the land value and including the built-up or carpet area, besides construction quality.
2. For insurance of contents like electronic items and jewellery, take a cover on an actual basis i.e. it should be itemised. It is always better to prepare a list of items to be insured. A valuation certificate of gold and other jewellery can be handy.
3. Always remember to insure contents for their present replacement value (new) as insurers reimburse without depreciation in case of repair/partial claims.
4. During the year, a family adds to the list of assets i.e. they may buy new appliances or jewellery. Please inform your insurer, as these items can also be covered.
Assess the premium
5. The next step is to assess the premium. You will be surprised that the premium costs can be just Rs 5 per day compared with the total value of the property. It is highly recommended that you buy this product after understanding it and not because it is being pushed through your aggressive neighbourhood agent or any other intermediary.
The procedure for claims is also simple and hassle-free. In case of a loss, always inform your insurer immediately. For domestic appliances or electronic items, it is always good to contact the manufacturer's service centre. For theft loss, please file a police report immediately and inform the insurer. In case of any doubt or assistance, you can call the insurer's call centre.
A home insurance can provide complete relaxation not only physically but also fiscally.
Source: http://economictimes.indiatimes.com/
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