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Did you read this? Seems quite unbelievable that India’s financial capital will literally disappear underwater in the next three decades. But having witnessed the ravages of a furious cyclone on the western coast of India just last week, the fury of the ocean is a reality too close to home.
It is also a reality that your physical home is what can get irreparably damaged when calamities like this occur. Not just natural calamities but fires, pipe leaks, thefts and other unforeseen incidents can leave you with a big gaping hole in your home and subsequently your wallet!
It may not be a top priority, and really our minds are not used to thinking about such calamities and emergencies, but you think a little bit and you will realise hedging your losses against such events may be the smart way forward.
How does one do that? Two words – Home Insurance.
Perhaps it’s too soon to be thinking about it as you may not have many valuables in your home just yet. But, if you are planning to get married soon, the valuables will be there whether you like it or not. Maybe you can even advise your parents who you live with about home insurance – it’s never really too early to be aware of wise choices in life.
Why you should consider home insurance?
- First things first, it doesn’t cost that much, rather it’s very inexpensive.
- Natural calamities like floods are getting all too frequent – think Chennai floods in November 2015
- You have furniture in the house which you want to preserve for a few years
- Your emergency fund doesn’t cater to resetting your home for damage caused by unforeseen calamities
- Your bungalow is easily accessible to robbers or you live in riot prone areas
What you can insure
- Structure
- Contents and
- Even rent!
What it costs you
Both owners and tenants can opt for home insurance, the variable will differ. There are many considerations to opt for. If you want to be covered for damage from electrical appliances and terrorism you will have to select that specifically. Some insurers will cover jewellery and others won’t.
The final premiumThis is the amount you pay for keeping an insurance policy active. Usually paid in a lump sum at the start of the policy term or annually through the term, it includes all the charges and levies by the insurance... More will depend on the size of the house, whether it is rented or owned, the value of contents that need to be covered, whether the property is on loan and so on.
You will not be able to insure an under-construction property. For content worth around ₹20-25 lakh, you should be able to get a home insurance for around ₹10,000 a year.
If you need to relocate your home till repair or reconstruction work is being done due to the above mentioned natural or man-made events, then some insurers will also cover the interim rent.
There are close to 15 different insurers who provide this kind of cover, however, before you pick one, compare
- PremiumThis is the amount you pay for keeping an insurance policy active. Usually paid in a lump sum at the start of the policy term or annually through the term, it includes all the charges and levies by the insurance... More for the value you want covered
- The claim settlement record, how soon the insurer pays out the sum assuredSum assured is the amount you are insured for. In case of insurance for inanimate objects, the sum assured is what you will get and reduces as goods age or their depreciated value changes. In case of life insurance, there... More
- After-sales service
Getting your home insured is now so easy that laziness is not an excuse. It is true that you will not realise its importance till you are hit by an event that costs you more than you bargained for. But just like you don’t wait for an accident to happen to take up a medical insurance, don’t wait to return home to a pipe burst after a two-week vacation abroad. Replacing those soaked up wooden chairs, cupboards and clothes can be a rather expensive affair if you aren’t prepared!