Moving to a new city involves a lot of planning, and it gives hope for a better home, vibrant days, and an exciting future. However, while shifting cities or moving homes, you must think about what will happen to the home insurance plan of the current house? Although home insurance plans are not mandatory, they have risen to a trend due to India's high prices.
Home insurance plans are offered for particular residential properties and are calculated based on home location, exterior, etc. Hence, while you shift to a new house, it may not be possible to continue with the same insurance policy since homes cannot be moved and price varies due to location. It is essential to contact your insurance company and inform them about the relocation. The insurance policy will be updated based on your decision to rent, sell or leave home with a caretaker. If you aren’t happy with your existing home insurance policy or find some other home insurance more appealing, you can always make the switch. However, it would help if you were very sure about this step.
If you have decided to discontinue the current home insurance and purchase a new one, you can start by exploring different insurance companies. You can compare their features and offers and then invest in the one that offers the most benefits. Here are some popular types of home insurance policies:
It protects your home against all kinds of accidents, natural calamities, riots, house-break and so on.
It protects your house along with the fittings.
It protects the house against natural disasters like earthquakes, floods, etc.
It safeguards all the important belongings inside the home like the TV, fridge, sofa set, etc.
Here is the list of some famous home insurance companies and their interest rates as on 8-Mar-2022:
| Insurance Company | Minimum Interest Rate | Maximum Interest Rate |
| PNB Housing | 7.90% | 9.70% |
| SBI | 7% | 7.85% |
| Bank of Baroda | 7.00% | 7.50% |
| HDFC | 6.90% | 9.25% |
| Bank of India | 6.85% | 8.25% |
| Union Bank of India | 6.85% | 8.40% |
| ICICI Bank | 6.90% | 8.05% |
| Axis Bank | 7.75% | 8.55% |
| Bajaj Finserv | 6.90% | 11.90% |
| Kotak Mahindra Bank | 6.75% | 8.45% |
While purchasing a new policy cover, there are a few takeaways that you should check for in your insurance-
● Homeowners' insurance policy should cover destruction and damage to a house's interior and exterior, theft or loss of possessions, and personal liability in case of third-party injury.
● Three basic levels of coverage should exist: actual cash value, replacement cost and extended replacement value.
● Policy rates are largely impacted by the insurer's risk that you will file a claim. Hence, they assess based on past claim history associated with the property, neighbourhood, and also on the home's condition.
If you have sold or rented your house, you might wish to downgrade your home insurance policy because cancelling the policy in the mid-term might cost you a cancellation charge. Always read the policy terms and conditions beforehand. Also, sometimes insurance companies provide the facility of switching policies of homes. So, talk to your home insurance company to know if such facilities are available and what additional benefits you would receive for switching the policies.
Switching insurance policies gives you more control over your home insurance policy and you are allowed to do it anytime you want. The most common reasons for switching home insurance companies are
● Better price offering.
● Meeting a change in coverage requirements.
● Get amazing bonuses and discounts.
● Finding an insurer, you could be happier with.
While you are switching your home insurance plan, make sure you keep these points in mind.
A standard policy covers two main things- your house and its valuable content. Take note that the insurance covers your home for the construction cost and not the market value of the house. The construction cost is calculated depending on the built-up area and construction rate.
Before considering home insurance, make sure to consider all scenarios that might make you file a claim. Unforeseen events like natural calamity, theft, war, etc. Besides unforeseen events, the company will also compensate for renovating or repairing your home.
While choosing the policy, determine the coverage amount by properly assessing your property and belongings. If the value is lower than the sum assured, it is better than being under-covered. However, if the coverage is low, it would also mean that everything won't be covered and the premium would also be below.
While opting for a home insurance policy, do thorough research about the company's claim settlement ratio. Search on online forums to know if customers have any negative reviews about the company and what kind of insurance policies people mostly opt for.
Make sure you have read all the terms and conditions inclusive of exceptions and understand the policy well. You should also ensure that the address of your home is printed correctly and everything that would be covered under the policy is mentioned.
Shifting to a new city requires a lot of back and forth about various issues. Make sure to stay updated on the status of your home insurance policy and get in touch with the insurance provider if you need any clarification.
Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.
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