Have you got Insurance for your Property?

With this post, we begin our series on Real Estate Consumer Awareness. Do let us know if there are any particular topics you would like us to address

Before you bought your dream house, you went to the trouble of doing a thorough background check on the real estate developer. You checked the house for sturdiness, vaastu compliance and convenience. You ensured that there’s 23 hours supply of water and electricity and that there’s a gym nearby that you can use. After this, you also hired a competent property lawyer to help you through this important and expensive transaction. So why have you taken so long to make a decision about insuring the home that you took so much trouble to buy and into which you invested a majority of your savings?

It is very important to insure your home against any unforeseen calamity, whether it is a force of nature such as an earthquake or a flood, or even fires and thefts.  You can’t predict these things, so it’s best to take insurance, not just to protect your interests as an individual or family, but to also protect yourself from third party liability or in case you have taken a housing loan.

Of course, you should put in the same kind of time and effort into deciding on a home insurance. You need to keep in mind a few points before you make a final decision. The first thing is to know what kind of insurance you’re looking for.

The two most well-known kinds of home insurance that are available in India are:

• Building insurance: It covers the structure of the property, and includes coverage in case of
  • Fire, lightening, explosion of gas in domestic appliances
  • Bursting or overflow of water tanks, apparatus or pipes
  • Riot, strikes, malicious or terrorist acts
  • Flood, inundation, storm, typhoon, hurricane, tornado or cyclone
  • Damage due to earthquake, subsidence and landslide
  • Damage caused by aircrafts or impact damage
  • Third party liability or personal accident

• Content insurance: It  covers the things inside the house, and includes coverage in case of
  •  Fires
  • Storms or flooding
  • Explosions
  • Theft and vandalism
  • Valuables such as jewellery, cameras and watches against all risks
  • All kinds of accidental breakage of plate glass fixed in doors and window frames
  • Loss/damage to domestic appliances due to electrical and mechanical breakdown

However, there are other types as well:

• Guaranteed or Extended Replacement Cost – This protects you against sudden inflation when your house is being constructed.
• Title Insurance – In case there is a property ownership dispute or there is a defect of title ownership due to forgery, fraud or other defects during transaction, this insurance will protect you from loss.
• Home Loan Insurance – This insurance come applies only to home loan and ensures that your loan will be repaid in case of your death, disability or loss of income.
• Loss of Use Insurance – This insurance comes in handy when your house becomes so damaged due to some unforeseen disaster, that it’s impossible to live in it. It will allot a temporary home or will provide with a sum of money to cover hotel bills, meals etc.

Remember, your house is the most expensive and important thing you will ever purchase. Insuring it is the smart thing to do.

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(Image courtesy panproperties.blogspot.in)

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