Do you need home insurance?

By: Kavita Sriram

Kapil had a vacation house in the country side. He was distressed to know that some miscreants had broken into his house. Apart from theft, property was also damaged. While he had lodged a complaint with the police , he needed money for repairs of the property. Continuous monitoring of the property was not entirely possible for him as the house was in a remote location. What if property and things get damaged again? Will he have to incur the expenses again?

Homeowner's insurance is a form of property insurance that is designed to protect homeowners' property. Damages to the house or its contents inside are covered. Apart from forcible intrusions by criminal elements, the umbrella of cover can also be extended to accidents at home.

Kapil can consider this insurance product that covers damages due to accidents like gas leaks and fire apart from theft. You can safeguard your nest from unpredictable events and natural calamities with a simple home insurance. However , as you bring in more and more factors under cover like natural disasters, the premium goes upwards. This product stands apart as it protects both the home structure and the household contents.

Before you buy a policy make sure you understand the terms. If the umbrella of cover does not meet your needs, your hard-earned money in the form of premiums could be a colossal waste. Read the exclusions carefully. Damage caused by wear and tear, willful destruction of property or damage caused by war are usually not covered. The list of exclusions varies from insurance company to company.

Known by different names like 'Home and Contents Insurance' and 'Home Insurance' , it is a product tailor-made for people like Kapil. Kapil can be free of anxieties as the cover offers protection against theft, fire, earthquake, lightning, storm, vandalism and other threats. Be it the house you live in or a far-away vacation house, you can sleep in peace with this cover.

A host of household items like electronic equipments, furniture and furnishings, jewelry , expensive clothes and artworks can be insured as contents of the house. Apart from peace of mind, it gives a tremendous financial cushion in case of calamities. If the family is forced to relocate to an alternate accommodation because of a theft or accident, the cost of the additional temporary accommodation is borne by the insurance company too. Apart from the terms, ensure that the compensation is inflation-adjusted . A low compensation that does not factor in inflation, especially in an inflationary economy, can make your money appear insignificant .