Take shelter before it starts to rain

TA Ramalingam

After the long scorching heat of summer, the southwest monsoon has brought much-needed respite and coolness to many parts of the country.

Although the cool monsoon breeze and rains bring joy to our lives, they also carry their own risks. Even as other parts of the country await the northeast monsoon, a major concern for most people during the monsoon is the damage heavy rains can cause to their homes and property.

Every year, various parts of the country witness floods, floods, storms, landslides and other natural calamities.

If the monsoon has you worried about the safety of your home, there’s a simple solution: home insurance. Home insurance covers policyholders against unforeseen loss or damage to their home and its contents.

Financial protection

Such a policy ensures that the insured has financial protection if something happens to their home. In addition to covering natural calamities, home insurance also covers losses resulting from fire and related perils, theft and burglary; it also covers appliance failures due to voltage fluctuations as well as accidental damage.

You can insure your apartment, apartment, independent building, or villa. In general, home insurance covers the following two aspects:

Building coverage only: Covers the building or house structure.

Contents-only coverage: Covers all property or contents in the home, such as furniture, appliances, jewelry, and valuables.

The insured has the freedom to purchase coverage for the building only or the contents only or both. However, it is advisable to opt for comprehensive coverage, which includes both the building and the contents, to obtain complete protection for your home.

If someone lives in a rented home, they may consider purchasing “contents only coverage,” which will help the insured protect all of their valuables. If you own an apartment in a company, it is also prudent to cover the apartment with individual home insurance to ensure you are adequately covered should the need arise.

Assessment options

The insured has the freedom to choose from three types of valuation to arrive at the sum insured for the building—restoration value basis, indemnity value basis and agreed value basis.

Restoration Value: The claim is settled by repairing, restoring or replacing the damaged goods/goods with new one in a condition equal to but not better than the condition of the goods when new. The liability of the insurer will be limited to the sum insured.

Indemnity value: the claim is settled by indemnifying the insured according to the market value of the assets/goods after deducting the depreciated value.

Agreed value: The claim is settled according to the value agreed between the insurer and the insured at the beginning of the insurance period. This only applies to an apartment or apartment.

Correct estimate

When assessing the value of the property, it is wise to take the help of an expert to get an accurate estimate of the property.

The insured must give exact details related to the property, such as size, location, floor plan and height of the building, to name a few.

To cover the content, it is necessary to give the approximate value of the present content. An appraisal certificate for jewelry and gold objects will also help the insured to accurately assess their value.

If the insured acquires new property such as electronic objects or other valuables that he wishes to cover, he must inform the insurer; new items can be easily covered by paying an additional premium.

Besides the standard cover, insurers also offer many useful add-ons such as loss of rent, temporary relocation cover, key and lock replacement cover, liability cover and lost wallet cover, for n to name a few.

What do these policies not cover? These policies do not cover willful or intentional destruction of assets, natural wear and tear, loss or damage to contents due to faulty workmanship or manufacturing faults in electrical devices.

So, now that you understand the benefits of having homeowners insurance and how it can help protect your most valuable and important possessions, it may be prudent to assess your needs and opt for homeowners insurance.

(The author is Technical Director, Bajaj Allianz General Insurance)