A home is important for all of us and we like to protect everything we love. We ensure everything we possess- our cars, our health, and our life similarly it’s equally important to insure your house. Home Insurance is not understood by many people as the traditional plans have been commonly bought by all and many people have found it not coming to their use when they require it in a situation of eventuality. The technicalities of the Policy such as the Reinstatement clause, breakdown of the gadgets, claims of the content, and more such aspects have conditions that are practically difficult to adhere to. Recently, home insurance is going through a revolution as we witnessed in many categories of insurance such as Motor Insurance, Health, Liability, and many more. The new generation of Household Insurance has plugged many of the loopholes the traditional plans have. And the features not only provides protection against fire, earthquake, and other peril of fire like a flood, and riots on agreed value but also for the content of the house is also agreed value. The concept of Agreed value makes the difference and the definition of the same is “The Sum Insured for Flat / Apartment on Agreed Value Basis shall be valued by evaluating based on the covered square feet area of the property as mentioned in the Registered Sale Deed Agreement multiply by Circle rate issued by the Revenue Department of the State Government for the locality in which the property is situated as on the date of the proposal or the amount mentioned in the Valuation Report of a Government Approved Valuer as accepted by the insurer contents of the house”. Thus the agreed value insurance is the valuation of the assets which once declared and accepted by the Insurance Company the claim will be settled on the same value without any discrepancy.
The policy could be classified into two categories of the class of Owners as per the product available in the industry, so far. Home Insurance Products for :
- Super HNI's, super-rich class of owners of big independent properties
- HNI's and middle class who own relatively smaller dwelling
Building or Flat against Fire and Earth Quake
Building (Sq.ft * Reconstruction Cost) - Includes interiors of the house such as Marble flooring, paneling, ceiling, plumbing, sanitary ware, concealed electrical wiring, paneling, Plaster of Paris Work, Wall Painting, and any other permanent fixture and fittings situation within your Home. The Fire Insurance has 11 perils and the coverage is available against all such perils, they are;
- Aircraft Damage
- Riot, Strike, and Malicious Damage
- Storms, Cyclones, Typhoon, Tempests, Hurricanes, Tornado, Flood and Inundation
- Impact Damage
- Subsidence and Landslide including Rock slide Bursting and/or overflowing of Water Tanks
- Apparatus and Pipes.10) Missile Testing operations.
- Leakage from Automatic Sprinkler Installations
- Bush Fire
Earthquake is a separate cover that can be availed along with the fire insurance only.
The valuation is done by an approved valuer as some companies require the same and help to arrive at the Sum Assured which once agreed and accepted will be honored by the Insurance Company in case of any eventuality which may arise (Refer to above for Agreed Value Insurance). Though it’s advisable to take Agreed Value insurance as it is a new concept one can also get house property insurance at;
- Reinstatement Insurance
- Indemnity Value Basis
Content and Furniture (Furniture & Fixtures)
Content and Furniture (FurniturFurniture & Fixtures) - includes loose furniture like Sofas, beds, dining tables, chairs, tables, wardrobes, clothes, handbags, shoes, belts, and other accessories, cupboards, movable & immovable fixtures, electrical items like AC, LED, Audio & Audiovisual appliances, domestic appliances and other contents of the house. Exclude items considered under Fine Arts & Valuables. The valuation of content is also on self-declared value for HNIs but second-category products allow a limited amount which is fixed at the time of purchasing the policy and the same gets payable in case of any fire Incident.
Domestic Electrical & Electronic Appliances
Domestic Electronic & Electrical Appliances (Television, ACs, Kitchen Appliances, LED, Music Systems, and other appliances) and Complex tools like water purification plants, lifts, generators, UPS systems, Steam / Sauna systems,s, etc are also covered under the All Risk coverage which includes any loss due to breakdown and fire damages. The value again works on the Agreed Value for Fire Insurance and mechanical breakdown.
Painting & Artefects
Fine Art and Valuables-Sculptures (metal, stone), Antiques, Silverware(Utensils, Statues, Coins, Household Articles, Bars, etc.) Old collection of stamps and coins Other Valuables-Accessories (Designer Handbags, Shoes, Belts, Clothes, Pens, Sunglasses, Spectacles and other items of similar nature) The above has cover against Fire, Burglary, theft or accidental damage and all this is available on a worldwide basis. Valuation again is on Agreed value where no listing is required except for Fine Arts, Sculptures, Antiques, and stamp collections/coins that need valuation from a government-approved valuer.
Watches No invoice copy required. Only the make and model numbers are sufficient to insure. No depreciation is applicable at the time of claim. Complete replacement costs, not more than the value declared will be paid. Repairing cost due to accidental damage is covered under the policy.
Option of Segregating the Jewellery between:
- Jewellery in Bank Vault
- Jewellery in Home Safe
- Jewellery Worldwide
The valuation is compulsory and one can segregate or insure collective on a floating basis between the aforesaid locations on a worldwide basis.
Portable Electronic Gadgets
The portable items are the electronics moveable gadgets that are used personally by the family members. For example- Mobile Phones, Pads, Macs, laptops, and all such expensive items which are used at home. The insurance company will indemnify you in respect of the accidental loss of or damage to “Portable Equipment” anywhere in India. However, on payment of Additional Premium, you could avail of the coverage Worldwide, however, there is a condition regarding the age of the equipment. In 1st category the limit is flexible and the companies offer beyond 5 years old too, but the common restriction is beyond 3-5 years old for the purpose of the coverage in 2nd category.
The insurance companies do offer some extra cover by charging extra such as;
- Liability cover- against the family by outsiders like servants, maids or any third party
- Landscape and Garden cover- This is extension of house insurance which can be covered against damage by any means ie beyond perils of Fire
- Pets can be insured for a limit against any ailment
- Valuables like expensive Chandler, lamps any other valuable items can be covered.
- Key and lock Replacement cover- you can get the coverage for the expensive lock system of the house against the mechanical damage
- ATM Withdrawal Robbery- One can take coverage upto a limit for any robbery that occurs in the family
- Loss of Rent- For the rented property one can avail loss of rent for specified months incase of any accidental damage due to Fire peril
All above are available by paying extra premium, however, the conditions differ from every Insurance Company. 1st category gets more flexible terms than the 2nd category of property holders.
The policy could be classified into two categories of the class of Owners as per the product available in the industry, so far. Home Insurance Products for:
- No known/reported losses till date
- No selection allowed under contents section
- Standalone portable equipment under contents can't be covered
- Insurance company would require invoice copy of portable equipment at the time of claim
- Portable Equipment:- (other than Mobile Phones) not older than 5 years, Mobile Phones not older than 3 years
- Any Manufacturing defect in any of content and valuables
- Any design defect in the building is covered
- For Jewellery & paintings sections - Correct, proper& valid valuation report is required where Jewellery and Painting is always subject to contents are covered
- Pedal Cycles, Electrical and Electronic Appliances whilst stored or lying in the Insured’s ”Building”, Clothing, not older than 10 years
- Losses due to Terrorism or War is not covered
- Maximum SI for Add On Cover i) Temporary Resettlement Cover ii) Keys & Locks Replacement Cover has limits
- Any malpractice or fraudulent or carelessness would not be covered for damage of content or building or burglary