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Buying home insurance in India? Here is how to choose the right one

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Published on June 21, 2021. EST READ TIME: 3 minutes

Simply put, home insurance is a financial safeguarding of where your heart is – and that is, your home. Your home is your safe space, one where you unwind, recuperate, and get the energy to face the world. And that is why protecting your home is a must. Any untoward or unfortunate incident causing damage to the things you hold dear can have severe financial consequences, let alone the emotional ones. Luckily, a home insurance policy goes a long way in protecting your property and its belongings, keeping you stress-free in the process. But before you choose the right one, here are the different kinds of policies you should know about:

Structure/standard fire and special perils policy

This policy covers the permanent structures of your house, such as the roof, floor, walls, and other structures, against any manmade or natural calamities, including fires, and special circumstances such as:

• Floods, lightning, landslides, earthquakes, forest fires, volcanic eruptions, tsunamis, etc.

• Manmade disasters like fire accidents, protests, riots, strikes, and ill intention

• Damage caused by contact with rail, road, or vehicle (not belonging to self)

• Water damage due to bursting of pipes, or overflowing water tanks

• Missile testing operations
  However, this excludes damages caused by war, national invasion, nuclear operations, terrorist activity, pollution and contamination.

• Public liability coverage
  This type of home insurance policy covers any type of damage incurred by an individual on your property. Furthermore, for any damage caused by your property to another property, the third party is compensated with this policy.

• Contents insurance
  The structure policy as discussed above, covers the skeleton of your house. The contents insurance policy covers the valuable goods inside your house against theft or loss, owing to water damage, fire, flood, and the like. It can include electrical appliances, jewellery, television, artefacts, artwork, important documents, etc.

• Tenants’ insurance
  Home insurance is not restricted to homeowners only. Even residents staying on rent can avail a home insurance policy, namely the tenants’ home insurance. Tenants can skip the structure insurance policy and opt for the contents insurance policy instead. Such a policy will cover against the loss or damage of your belongings.

• Landlord’s insurance
  A typical home insurance policy may not apply to a landlord who does not reside in the property. Home insurance policies usually cover the resident or the building in question. This special type of home insurance policy for landlords covers them specifically against third-party liability, and loss of rent.

• Comprehensive home insurance policy
  This policy covers both – the structure and contents, against manmade and natural calamities. It is ideal for homeowners who live in climate-sensitive zones.

All in all, it is prudent to compare home insurance policies to understand what they do and do not cover as well. Most policies will not cover losses against pre-existing damage or defects, depreciation, wear and tear, properties under construction, misconduct, wilful negligence, and cost of land. So, choose a home insurance policy that takes care of your specific concerns, and opt for the required add-ons. Also consider the claim settlement ratio of the insurer before signing the documents.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.