But many in her city weren’t that lucky. Getting life to normalcy after a tragedy depends on the degree to which one has been affected. A house is an individual’s biggest asset and also the source of one’s financial and emotional strength.
Re-building a house in the aftermath of a natural disaster can be highly demanding both financially and emotionally. Nobody anticipates such doomsday scenario for themselves but it happened many in Chennai. At an interest rate of 10 percent, a house that would cost Rs 50 lakh today will cost upwards of Rs 80.5 lakh in 5 years (not accounting for other market factors such as demand and availability). This means for accommodation, in a lifetime you would spent a total of Rs 1.35 crores for a house originally worth Rs 50 lakh. A home insurance is your best bet against this.
Sum assured and premium?
The sum assured (to you by the insurer at the time of claim) will either cover just the structure of the house or comprehensively both the structure and its contents.
The sum assured in such policies usually depends on the cost to be incurred while replacing the house or its contents.
The premium to be paid to buy the policy cover is calculated on the basis of many factors such as location, built-up area, and age of the property and tenure of the insurance. Note that many policies do not have protection against burglary or terrorist attacks built-into the plan but these can be bought as additional add-on covers with the policy.
The home insurance policy can either be renewed annually or bought for longer durations in the range of 3-10 years and differs from policy to policy. Lot of insurers give heavy discounts on longer duration covers.
What is compensated by a Home Insurance policy?
The home insurance policy covers the building structure and contents, loss due to burglary/ theft, loss of jewellery or valuables, baggage loss, damage or loss of domestic and electrical appliances, damage to electronic equipment and other belongings like Pedal cycles, etc.
The policy generally covers the structure of your home and contents against
- Fire, Lightning, Explosion/ Implosion
- Riot Strike, Malicious and Terrorist Damages
- Earthquake, Volcanic Eruption & other Convulsions of Nature
- Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood and Inundation
- Bush fire
- Aircraft damage and Missile testing operations
- Impact damage by rail/ road vehicle and animal
- Subsidence and Landslide including Rockslide
- Bursting and overflowing of water tanks, apparatus, pipes
- Leakage from automatic sprinklers installations
The usual exclusions are willful destruction of property, any loss or damage to any property that is illegally acquired, kept, stored which is subject to forfeiture, any loss or damage by the insured and/ or insured's domestic staff direct or indirect involvement in an attempted burglary, any loss caused by war, wear & tear, and/ or If the property was vacant for more than 30 days without prior notice to the company.
Any loss or damage suffered due to the following is treated as an exception and cannot be claimed:
- Any loss or damage on account of loss of livestock, motor vehicles, pedal cycles, money, securities for money, stamp, bullion, deeds, bonds, bills of exchange, promissory notes, stock or share certificates, business books, manuscripts, documents of any kinds, unless specifically mentioned and valued.
- Consumable articles.
- Loose precious stones, jewellery or valuables, unless specifically mentioned and valued.