Myths Related to Home Insurance

When you purchase a new flat or build a house on your own land, it takes a lot of investments and thoughts. Once you start living in that house, another responsibility arises that is to keep your home secured. To keep your home secured from any unforeseen incident, there are many insurance companies that provide home insurance policies. When you decide to purchase a home insurance policy and start searching for a suitable one, you check the kind of coverage that insurance policy is providing, benefits, premium rates and exclusions as well.

However, many policyholders believe that they will get cover for any kind of damage whether the house or the contents of the house. This is not entirely true. So here we are going to break down some of the common myths related to the home insurance policy.

Loss of Use

If you live in a city or area that is near a river or in the mountains that makes your home very much prone floods, rock sliding and typhoons. However, your home is covered under an insurance policy and you are under the wrong impression that it will provide you cover for almost everything. Well, this is not always true. Not all kinds of home insurance policies provide loss of use cover.

Let suppose, your house got hit by a flood and gets damaged severely that you cannot even live there. Then you expect that your insurance provider will put you in a hotel until your house is getting fixed and livable. So, at this point, you have to be very keen and check if your insurance policy provides loss of use cover because it would be mentioned explicitly in your policy otherwise you will have to pay for the hotel, meal and other things out of your pocket.

Replacement/Renovation Cover

When you purchase a home insurance policy, it is recommended that you go through it thoroughly. It is because everything that is covered and that is not covered under the policy is mentioned in it. There are many insurance policies that do not provide cover for the contents of the house, so better check if the insurance policy provides cover according to your requirements. But there is a catch in it.

Let me explain it to you with an example, if you have a television set which you bought in Rs. 50,000 and now it is two years old. So if it gets damaged or burgled, the insurance company will only provide cover at what the television set was worth just before it got damaged or burgled and not at the rate you bought it from the showroom.

Cover for Termite

Termites work like a slow poison to the wood. They grow slowly and eat up the whole wooden part of the house whether it’s a cabinet or a tv unit termites tend to attack in the winters. Although most of the houses in India are made of concrete but there are houses in the hill stations made of wood and they are more prone to get damaged by termites.

Once the termite eats up the wooden work of the house, revamping it can cost you a lot. Even though you are covered with a home insurance policy but not all insurance policies provide cover for damage caused by termites. So if you have built your house using wood then it is recommended that you choose the right home insurance policy and look for termite cover.

Cover for Act of God/Natural Calamity

Most of the home insurance policies provide cover for natural calamities like floods, wind storms, wildfires etc. Depending on your home location your insurance company provides you cover and exclude accordingly. If we talk about flood particularly then it is one of the most common cause of damaging a house and especially the one located near rivers. So, it is advised by the insurance experts to go for a home insurance plan that provides comprehensive coverage and also covers water damages. You can add-on a separate cover to your existing home insurance plan if you want to.

Conclusion

When you are purchasing a home insurance policy then it is advised by the insurance experts that you go through that plan thoroughly. You cannot depend on word of mouth and purchase a policy. There are many myths and false news out there related to insurance policies. If you have any doubt related to the policy coverage, premium rates or add-ons you can always consult with their agents offline. But there are many informational websites that provide the right information related to the insurance policies and you can learn about your policy and all the other aspects like add-ons, inclusions, exclusions, benefits and not just this you can even calculate the premium rate of the home insurance plan you plan to purchase on your computer sitting at your home or office.