Home Insurance

Home Insurance

What is Home Insurance ?

What great pleasure lies in the often repeated statement, ‘I am home’. A home is a place of rest, sanctuary and the word itself signals peace and finality. A house also entails a tremendous expenditure of money, emotions and time- a onetime investment in many of our lives. Thus, securing this symbol of independence and achievement, against natural calamities and man-made conditions, is an extremely important concern. Ergo, the need for a good, comprehensive and timely Home Insurance Policy.

In India, Home or Property Insurance is a popular banking product. Being secure is better than being sorry- the essential tenet behind the concept of insurance, applies particularly to an emotional and costly insurance such as your family home. Aside from the structure itself, a good home insurance policy provides protection to the items/ implements/ appliances and prized possessions included in the home. A trusty home insurance policy is not just the protector of your cherished home, but the precious and unique memories and emotions that reside therein.

Features and Benefits of Home Insurance:

Subscribing to a comprehensive home insurance policy allows you to enjoy the features and benefits, following

Complete coverage against financial liabilities arising from the damage/loss of your home and/or its contents due to natural or man-made reasons.
Thoughtful additional covers including Burglary and Theft Cover, Earthquake Cover, etc. for specialized protection.
100% mental peace when there is a solid security to fall back on, especially in these times of social strife and environmental upheavals.
Applying for a home insurance policy is simple, the turnaround times are quick and almost all banks in India offer this very dynamic product.
After the calamity that resulted in the damage/loss of your home, the on-time home insurance payouts will massively assist in helping the family put their lives back together. A big relief in such a trying time.

Eligibility for Home Insurance:

There are certain criteria that you must fulfil in order to obtain a home insurance. This varies widely from company to company. However, most companies have minimal requirements when it comes to home insurance. They are:

Home Insurance Policy can be bought by individuals or by companies. Individuals who are Indian residents and the owner / occupant of a property can get a Home Insurance Policy. Home Insurance - multi year policy, however, can be purchased only by the owner of the house/flat.
To buy Home insurance for a society, any authorized member of the particular society’s managing committee can make the purchase. The policy will be issued in the name of the society and will cover the society building as well as the utilities that are for common use in the society.
It’s not just owners who can get home insurance. Many insurance companies provide cover for contents to tenants as well. Contents insurance will cover your possessions against loss or damage by lightning, fire, theft, smoke, flood etc. Everything from personal belongings, furniture and electrical items including washing machines, dryers etc. can be covered. You must read the fine print carefully before buying cover as a tenant. What is covered will vary from company to company. For example, certain insurers will not cover contents if you live in a shared accommodation. There are many such exceptions that you must look out for.

Home Insurance Claim Process:

Given the times we live in, one cannot be entirely safe at home or even outside. The same risk extends to our prized belongings too, like our house or vehicles. So, while vehicles are protected by a , our house also requires similar protection, which can be provided by a home insurance policy. One of the most crucial elements of a home insurance policy is the claim settlement process. A smooth claim settlement process can easily make or break a home insurance policy. The process of claim settlement is very crucial to a home insurance policy and it is important for every home insurance policy owner to familiarize themselves with the basics of the process. So, here are a few handy pointers to remember when you have to make an insurance claim.

First and foremost, evaluate the damage that the house has sustained. Even if there has not been any major damage, it is important to get an estimate.
If the house has been burgled or there has been a theft, the immediate step must be to contact the place to file an FIR, and also contact your insurance provider.
One of the more important things to do, in a situation where the house has sustained damage is to record the same via photographs. Take photos of the house or your could record the same on video by walking through every part of the house. Also, do not toss away the items inside the house which may have been damaged. All his is necessary in order for you to substantiate your claim.
When assessing the damage caused, you must take all the costs into consideration like the cost of labor, materials and even the items inside the house which have been lost or damaged. Also, add any cost that you might incur on alternate living arrangements while your house is under repair.
It is important that you contact your insurance provider before taking any action.
Find out the time limit that your home insurance policy carries regarding the filing of claims. Usually, companies have a time limit within which you must file for a claim.
You must ensure that no further damage is caused to the house. Also, make sure you save all receipts on whatever expenses you do incur and submit the same to the insurance provider.
Once you have notified the insurance company about the damage, you will be required to fill up the claim form. Ensure that you do not miss out any details and also provide correct information. Also, given that insurance policies are often time bound when it comes to filing of claims, try sending the filled out form at the earliest so the claim process can be initiated.

Following this, once the company has received your Claim Form, the insurance company will send a Surveyor or Adjustor to inspect the damage that the house has undergone. Though the insurance company is very unlikely to disapprove of your claim, the surveyor’s report of the damage definitely holds ample weightage in the decision.

Once the insurance company has accepted the claim, the next step of the process is settlement of payments incurred towards the repairs to the house and restoration of the contents of the house which have been damaged or lost. For any specific questions regarding the claim settlement process, you can also contact your home insurance provider to provide you with the necessary details. After all, your house is also one of your most prized investments which must be provided with adequate protection, just like your loved ones.

For example, the claim settlement process for House Insurance involves the following steps.

Policyholders must immediately inform the company about the claim by calling on their 24/7 helpline number (toll free).
Following the intimation to the insurance company, the policyholder must provide them with all necessary or relevant information not only pertaining to their policy but also details regarding the damage that has been caused. Once the claim request is Consequently, your claim request is verified and validated, the claim settlement request is forwarded to the insurance company’s Claims Department.
Once the company has validated and registered the claim request, the insurance company will appoint and send across a surveyor within the next 48 hours.
Following the Surveyor’s report, you must submit all the necessary documents to the Surveyor. Once the Surveyor has inspected the damage caused, they will prepare and submit a Final Survey Report (FSR) and the required documents to the company within 7 days.
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Experts Says That Insurers Should Oblige to Claims Made Due To A Natural Calamity

Cyclone Vardah has caused significant damage to buildings, automobiles, and businesses in Chennai. Insurance companies are now flooded with numerous insurance claims from policyholders who had taken home insurance hoping to protect their house in case of eventuality. When insurance companies say that they protect your home and cover for any expenses caused due to a natural calamity, they do not mention in specific that they do not cover damages caused due to rainfall. It is mostly found in the exclusions list in the insurance documents written in small letters. This christmas is not a time to celebrate for Chennai residents as rain has caused severe damage to their properties. Puneet Sahni, Head Product Development in SBI Insurance Company stated that normally damages caused by rainfall is not covered by insurance companies however cyclone Vardah has caused an havoc in Chennai and insurance companies should act morally and accept claims made.

Home Insurance one of the least owned policies in the country

Although India has seen a whopping $9.8 billion loss due to natural disasters like earthquakes, cyclones, floods, tsunamis, and storm surges, home insurance is still one of the least owned insurance policies in the country.

Pointing out the same, a media house recently reported that there are actually plenty of advantages to owning a home insurance policy.

In the report, the media house listed out the various covers a home insurance policy would provide the policyholders. Among the many things a home insurance covers, the main ones include protection against natural disasters, man-made disasters, against terror attacks and riots, and also provides coverage against the contents of a house.

A young newly-married individual usually has a long work life ahead of him/her, and subsequently many hurdles to cross before he/she creates wealth and financial securities for the family. Listed below are some of the essential insurance products that he/she must purchase in order to secure the family’s savings:

Life term insurance - A term insurance plan is a low-cost policy that is ideal for a person with a family. There is no investment component involved in the coverage. One can look for a cover that is 20 times his/her current annual income for securing his/her long-term financial needs.

Health insurance plan - Hospitalisation expenses today are highly steep; hence, it is inevitable that one is in possession of a suitable health insurance policy. A cover provided by the employer may not be sufficient, as this would cease to exist when one leaves his/her job. To ensure that the cost of premium is low, it is advisable to purchase a family floater plan.

Critical Plan - A Critical Illness Insurance plan will protect the policyholder upon the diagnosis of a specified critical illness. The insurance provides the beneficiary a lump sum amount for the treatment of the disease.

Home Insurance - A home insurance policy will provide coverage for damage to the structure of the house from situations like fire. It also protects the contents of the home. The house owner or a tenant can purchase this policy.

Insurance Market Experiences A Boom Following 2015 Chennai Floods

Following the widespread destruction caused by the Chennai floods last year, the insurance sector has registered a significant 40% to 50% growth in policy sales not only in Chennai but also its surrounding areas as residents of the city becoming increasingly aware towards protection of their assets. According to reports, insurance claims following the floods touched Rs 5,000 crore.

The floods caused losses amounting to more than $2 billion, out of which the insured losses amounted to $0.8 billion. Analysis done by Swiss Re indicated that a major portion of the losses were reported from commercial entities, given that Chennai houses a large number of manufacturing companies, especially pertaining to the automotive industry. The boom in the insurance sector can primarily be attributed to customers opting for motor insurance and home insurance while companies are opting for fire insurance policies, motor insurance and machinery insurance.

Terrorist Attack Cover: An Add-on to Property Insurance Policy

Anticipating the increasing risk of terror attacks, insurance analysts suggest that it is wise on the part of customers to cover social events, public gatherings and the like. However, insurance companies follow certain measures for taking such requests into consideration. First and foremost being the assessment of risk factor.

Generally, individuals who have properties near to the most vulnerable locations should take insurance covers for terrorist attacks. These policies can be opted as an enhancement to their existing property insurance. Even the cost of terrorism cover is significantly low when compared to other insurance products.

Chennai Floods Leads to Increase in Home Insurance Purchase

The Chennai floods that ravaged the city the previous year have led to a spike in the number of home insurance enquiries.

Insurers have reported an increase in the number of home insurance policies being sold in the city and its neighbouring areas, with sales going up by 30%.

The floods that hit Chennai in November and December of 2015 resulted in damage worth Rs.14,000 crore, with about 35% of this being insured losses.

The need for home insurance and its benefits have been publicized after the floods, with leading insurers carrying out awareness campaigns in the aftermath of the flood.

A mere fraction of the claims paid out after the floods were for insured homes, but the renewed public interest appears to be changing the trend as homeowners opt for comprehensive coverage.

Unclaimed Insurance Amounting to Over Rs.11,000 Crore

According to reports, over Rs.11,000 crore are currently being held by insurance companies in the way of unclaimed amounts.

Parliament was informed of this in the recent session by the Minister of State for Finance. The Life Insurance Corporation of India (LIC) alone has over Rs.5,934 crore in unclaimed amounts as on March 31, 2016.

The large amount still unclaimed by policyholders has been described as something of a concern, with this amount accumulated over a period of time.

The majority of the unclaimed amount stems from the life insurance and home insurance sectors arising out of death benefit, maturity claim, survival benefit etc.

Premiums that have not been claimed for over 6 months are also included in this category.

Listing Insurance Companies to become Mandatory

IRDAI, the insurance regulator, will be releasing an exposure draft soon in an effort to make it compulsory for insurance companies to be listed. A discussion paper on the issue has already been released. The purpose of this paper was to emphasize the need for listing firms, and that listed companies will have stricter norms regarding disclosure. Presently, only ICICI Prudential Life Insurance has plans for listing the company. There will be more transparency in the insurance system when companies are listed. In terms of the number of insurance policies sold in 2015-16 and the premium income, the life insurance sector showed growth in double digits. These numbers have not been seen since 5 years. The high growth is mainly a result of the amendment to the Gratuity Act making the amount payable Rs.10 lakhs from Rs.3 lakhs. The gratuities are payable by the insurance companies resulting in higher funding. A number of banks have partnered with insurance firms as the IRDAI recently introduced new bancassurance norms allowing banks to sell only 9 policies which is 3 in each category of life, non-life and health insurance.

Robbery from home to be covered in renters and homeowners cover

You receive plenty of indemnity for what you spend for your renter’s insurance and home owner’s insurance. For instance, many such policies related to home insurance protects possessions stolen outside of your house, which is known as ‘off-premises coverage’. These policies also cover pet bites, damage to property, and your stuffs among others. You are also protected if your house belongings get stolen from, say, your car while parked elsewhere. 10 percent is the standard amount you will get after a claim. Hence please go through your policy carefully to know what all you can claim for and whether it qualifies for ‘off-premises claim’.