Home insurance is intended to protect homeowners from any damage to the house and its procession, and it can be taken for a fixed period. Here is everything you need to know about home insurance.
Types of home insurance in India
Homeowners are usually faced with two options for home insurance in India:
Basic fire insurance: This is the most basic policy and covers damages caused by fire as well as natural disasters like landslides, cyclones, etc. A lot of homeowners choose this policy as it offers protection for many common risks.
Householder’s package policy (HPP): If you want more comprehensive coverage for your home, you can choose a householder’s package policy. Apart from the risks that a fire insurance policy provides, HPP also includes missile testing, gas or water pipe explosions, landslides, terrorism, riots and more.
What is the amount covered?
The amount you can receive as insurance will not be the same as the market value of the property. Instead, it takes into account the cost of rebuilding the house or compensating for the damaged assets in the house. You can calculate the amount that will be insured by multiplying the total built-up area of your home with the construction cost (not the market value) per sq.ft. Your builder will be able to tell you what the construction cost of your home is. The valuables within your home, however, will be insured based on their current market value. While you will have to pay a premium as your home insurance, this will prove to be one of the important money-saving tips for your home in the case of any unforeseen damage.