A Mini Guide For Home Insurance Purchase
Home insurance is a security cover for your house. It helps one to protect his house from financial consequences of disasters. Home is one of the most expensive assets a person owns. It is not just an asset but more. A person’s home is where he dwells for most of his time and is the shelter of his dependents. It is the place where lingers the many happy moments of your lives. People work day and night to see their dreams of owning a house come true. Such is the value of a home. Perhaps it is rightly said, “Apne Ghar Se Achcha Kuch Nahi” meaning “Nothing gives more happiness than one’s own house.”
And to maintain you lovely abode, home insurance plays a vital role. It secures your house against the perils of various natural disasters and accidents.
Home insurance surged in popularity after many people were succumbed to the perils of natural disasters which took destroyed their houses. It is the worst stress indeed when a person’s house perishes and he does not possess sufficient capital to restore the damages.
Good quality home insurance policies provide coverage for below mentioned cases-
- Damages to the home’s structure due to any natural calamity or fire break-out
- Lost valuables and general features of the house
- Coverage plan for events like fire, robbery, explosion, housebreak and natural disasters
- Coverage received for loss or damage to jewels and gems (Need to confirm with the insurer)
- Coverage for loss or damage of electronic devices
- Flexibility in paying premiums whether monthly or yearly basis
- Online purchase facility
- Installation of safety devices like theft alarm, smoke alarm and any other such devices help in availing discounts on premium
- Insurance is extended on rented and owned properties
Evaluating home insurance quotes
Home insurance quotes depend upon various factors like-
- Rented/owned accommodation
- Property type- flat/bungalow
- Property’s age
How to determining coverage amount of the policy?
Coverage amount- It is the maximum amount which will be paid when any damage occurs to the home. Reconstruction cost of your house acts as the major factor determining your coverage amount.
The formula to calculate the reconstruction cost of your house is as follows-
Total constructed area (multiplied by) Construction cost per square feet
Most people think that cost of house forms a part while determining coverage amount. However, it’s entirely wrong assumption.
The market value of one’s house can be way higher than its reconstruction cost. Also it’s not a good idea to evaluate loss incurred to the structure. Insurance company’s job is to compensate the insured for the damages incurred and not for providing profit to the insured.
Opting for home insurance policy is a sensible decision. It will act as a robust protection for your most valuable asset.
Also you can then take a sigh of relief knowing that you have things in place if anything goes wrong.