Buying the right kind of home insurance to protect your home

By May 26, 2019 Money Matters

economictimes.indiatimes.com

As we get older and we settle down into a long, stable stay inn our home, the protection of that home becomes more critical than ever. One of the important ways to be able to do a good job of that protection is the judicious purchase of home insurance policy. Check out what the author has to say in the article below about how to work towards buying the right kind of home insurance. Team RetyrSmart

Buying the right kind of home insurance to protect your home

Taking cover

One way of doing so it is to opt for home insurance. Most home insurance policies automatically cover damage due to cyclones, earthquakes and the like.
Household insurance covers the structure and furniture and fittings inside the house. Choosing the right household insurance policy may be trickier than you may have thought

Buy structure cover only if needed

Before buying a comprehensive home insurance policy, find out if you need to take cover for the structure. Most housing societies insure the building and therefore, individual flat owners don’t need to opt for structure cover. “Flat owners need cover for the contents inside the house,” says Mishra. However, check if the policy bought by the housing society covers reconstruction costs and not only the depreciated value of the building. Several housing societies settle for depreciated building value to keep premiums low.

Go with the detailed plan for contents

If you want to insure the contents of the house, there are two plans to choose from–standard and detailed. Most insurers offer standard plans that assume a standard set of assets. However, experts bat for the detailed plan. “List every asset and take coverage for them. This offers several advantages. By giving full details at the time of taking the policy, claim settlement is smoother,” says Tarun Mathur, Chief Business Officer, General Insurance, Policybazaar. Standard plans also usually leave out costs related to repairs.

Go for replacement costs for contents

Experts say it makes sense to opt for replacement cost, instead of depreciated value, for household assets. “Houseowners should note that this will push up insurance costs,” says Sanjay Dutta, Chief, Underwriting and Claims, ICICI Lombard General Insurance. However, this will be useful at the time of claim. Assume a television you bought two years ago is damaged by lightning and the repair cost is Rs 8,000. The insurer will not pay the full amount if you do not opt for replacement cost.

Take precautions after insuring

Insurance laws ask you to take every step to protect your assets. Insurance companies usually educate people about this. “Once Cyclone Fani was announced by IMD, we sent out messages about ways to protect your assets like car, house, etc,” says Dutta. These measures are standard procedures like sealing any portion of the house where there is a chance of leakage and repairing old and creaky windows.

Protect your documents

Keeping important documents like degree certificates, registration documents of the house, etc in bank lockers is a wise step. Damage of critical documents can create serious problems in future. “Due to their design, bank lockers can withstand flood, fire, etc and therefore, will be safer than the house.” says Mishra. Please save insurance related documents also from damage because they would be needed to make a claim after any disaster.

Follow correct steps for claims

Insurers are usually lenient towards claims after natural disasters and therefore, claim settlement may not be difficult. “After any disaster, submit a claim intimation to the insurer. If it is fire related, you need to submit an FIR and the fire brigade’s report. Insurers release payment after getting reports from their surveyors,” says Mishra. No FIR is needed if damage is due to other reasons like flooding, short circuit or power surge.

 

 

 

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