Understanding The Advantages Of Home Insurance Policy In India 
A home insurance policy is one of the ideal ways to safeguard your house from theft or burglary when you are away. No matter how much you secure your home, burglaries can occur and you may end up losing your valuable belongings.
Hence, availing a home protection plan can help you stay secured from the financial loses that occur from such thefts.
There are different types of insurance policies for houses, covering a diverse collection of threats and their financial reimbursement. From natural disasters and climatic catastrophe to burglary and its likes; the threats are varied and property insurance policies on all these threats are available. As a prospective insured, you need to judge and understand which policy terms you should be looking for in a scheme before you avail one.
Of the different types of insurance policies, the coverage can also define the type of insurance. Primarily, there are two types of home insurances, their coverage schemes further divided into several categories. Advantages of such schemes can be conclusively discussed after understanding these two types of policies.
Home structure coverage
These are policies which cover the property itself. These home insurance policies cover the value of the land over which the house is built as well as structural and constructional costs. Among these types of policies, further subdivision based on coverage amount needs to be understood thoroughly.
Reinstatement value: In these schemes, only the construction cost of a house is covered and the value of the land is excluded. A major advantage of this scheme is that the premium rates are not too high, considering only the construction cost is under coverage.
Such schemes are only beneficial for individuals residing in safe land zones which do not have risks of natural disasters like tsunami or earthquake.
Agreed value: These policies cover both the constructed residence and the land for insurance coverage.
While such policies can be expensive in terms of premium rates, they are vital for residential properties in mountains or coastal regions which can be subject to natural disasters that can even affect the land and its value.
Indemnity value: This is the most economical house insurance policy available. These schemes cover the depreciated market value of the construction of a house. Consequently, its premium rate is also less, which is a matter of convenience for a customer. However, note that the coverage value does not vary over time, which may seem too little after a couple of years considering the rising property values.
Personal belongings coverage
Evident from its name, these are insurance policies which cover the assets present within the residential property. Again, this too can be divided into further categories based on the coverage provided by them.
Replacement value: Most convenient and encompassing of all these schemes, replacement value insurance policies financially cover belongings sans depreciation in their value. While the major advantage is that it leads to a higher overall financial settlement, it can have a downside of high premium rates.
Indemnity value: Here, a policy only covers a depreciated value of the contents of a house in case of theft or loss due to disaster. With an obvious downside of a lower financial settlement, these home insurance schemes provide comparatively more convenient and economical premium rates.
It is important to note that some insurance companies provide an advantage of add-ons, which is simply adding a further clause and in effect a higher coverage on the primary house insurance policy. Bajaj Finserv provides home insurance online and one can easily opt for it.
A home insurance policy is one of the ideal ways to safeguard your house from theft or burglary when you are away. No matter how much you secure your home, burglaries can occur and you may end up losing your valuable belongings.
Hence, availing a home protection plan can help you stay secured from the financial loses that occur from such thefts.
There are different types of insurance policies for houses, covering a diverse collection of threats and their financial reimbursement. From natural disasters and climatic catastrophe to burglary and its likes; the threats are varied and property insurance policies on all these threats are available. As a prospective insured, you need to judge and understand which policy terms you should be looking for in a scheme before you avail one.
Of the different types of insurance policies, the coverage can also define the type of insurance. Primarily, there are two types of home insurances, their coverage schemes further divided into several categories. Advantages of such schemes can be conclusively discussed after understanding these two types of policies.
Home structure coverage
These are policies which cover the property itself. These home insurance policies cover the value of the land over which the house is built as well as structural and constructional costs. Among these types of policies, further subdivision based on coverage amount needs to be understood thoroughly.
Reinstatement value: In these schemes, only the construction cost of a house is covered and the value of the land is excluded. A major advantage of this scheme is that the premium rates are not too high, considering only the construction cost is under coverage.
Such schemes are only beneficial for individuals residing in safe land zones which do not have risks of natural disasters like tsunami or earthquake.
Agreed value: These policies cover both the constructed residence and the land for insurance coverage.
While such policies can be expensive in terms of premium rates, they are vital for residential properties in mountains or coastal regions which can be subject to natural disasters that can even affect the land and its value.
Indemnity value: This is the most economical house insurance policy available. These schemes cover the depreciated market value of the construction of a house. Consequently, its premium rate is also less, which is a matter of convenience for a customer. However, note that the coverage value does not vary over time, which may seem too little after a couple of years considering the rising property values.
Personal belongings coverage
Evident from its name, these are insurance policies which cover the assets present within the residential property. Again, this too can be divided into further categories based on the coverage provided by them.
Replacement value: Most convenient and encompassing of all these schemes, replacement value insurance policies financially cover belongings sans depreciation in their value. While the major advantage is that it leads to a higher overall financial settlement, it can have a downside of high premium rates.
Indemnity value: Here, a policy only covers a depreciated value of the contents of a house in case of theft or loss due to disaster. With an obvious downside of a lower financial settlement, these home insurance schemes provide comparatively more convenient and economical premium rates.
It is important to note that some insurance companies provide an advantage of add-ons, which is simply adding a further clause and in effect a higher coverage on the primary house insurance policy. Bajaj Finserv provides home insurance online and one can easily opt for it.
