What is Home Insurance?
Home insurance is a type of insurance that is designed to protect an individual's home against damages to the house itself, to the property, or to possessions in the home, against certain natural or man-made unforeseen disasters.
Why Home Insurance?
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Home is one of the most priced possession and biggest investment that most individuals incur during their lives. Hence it becomes very essential to protect it against various uncertainties.
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Home Insurance helps cover for a lot of damages caused to the structure and the content of the house due to uncertainties like theft, hailstorms, riots, etc.
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If a home is purchased on loan/ mortgage, then the lender is required to purchase a home insurance in order to protect his interests in case the borrower defaults.
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It helps by providing cover for accidents caused to a third party in the home for which the owner could be held liable.
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Finally, it gives an individual a peace of mind that the home is protected!
What is covered in Home Insurance policy?
Home Insurance Policy covers:
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Fire & lightening
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Explosion of gas & domestic appliances
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Floods, cyclones, land slides, etc.
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Covers loss of household contents and expenses Incurred due to damage caused as a result of house-breaking & theft
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Jewelry and precious stones
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Covers any injuries or damages to third parties
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Building with landlord fixtures, fittings, wiring & sanitation
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Furniture, Fittings, Furnishings, Extra-wiring, False-Ceilings, Flooring or any modifications
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Utensils, Clothes and valued articles
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Television, VCR/VCD,Home-Theater
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Air-condition, fridge, washing machine, flour-mill, etc;
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Fixed Plate-Glass, Baggage
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Personal Accident
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Workmen Compensation Liability
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Personal Computers
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Damages due to terrorist activities, riots,etc.
What is not covered in Home Insurance?
Home insurance does not cover the following:
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Depreciation
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Damage caused due to wear and tear
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Destruction caused in case of wars (public/civil)
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Willful destruction of property
What are the types of Home Insurance policies available in the market?
There are various types of Home Insurance Policies available in the market, but they are majorly classified into 3 types:
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Structure Only Insurance: It provides cover against damages caused to the external structures of homes due to specific natural or man made catastrophes. Structure includes foundations and walls. It can be taken by home owners as well as for owners who give their property on rent. It does not provide cover for the contents inside the house.
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Content Only Insurance: Content only insurance covers the damages caused to the contents of the home due to man made or natural disasters. Content consists of domestic appliances, furniture, fixtures, fittings, sanitation, clothing, utensils, jewelry, wiring, etc. It can be taken only by home owners. It does not provide cover any structural damages.
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Structure & Content Insurance: It provides cover against damages caused to the structure as well as the contents of the house. It can be taken only by home owners.