Insurance cover for a home





There are many options to insure a property and household goods from theft and breakdowns

There are different forms of insurance available for a home. An insurance cover reduces risk. It is therefore advisable to go in for some cover based on the risks involved, and the potential loss.
HOME LOAN COVER
A home loan availed to buy property can be covered by insurance.This provides a cover for repayment of the home loan in case of the unfortunate demise of the borrower. As the loan amount in case of a property purchase is usually high and the tenure long, there is a greater degree of risk. This policy is more or less like a term insurance, linked with the tenure of the home loan.
PROPERTY INSURANCE
Insurance for the house itself is available. Here, there is the option of insurance for the household goods.None of these is mutually exclusive.It is possible to opt for one or a combination of more, depending on preferences and risk assessment.
Insurance of property covers the building. It covers the risk of damage to the property by natural disasters such as an earthquake or other specified risks. In case of such damage, the insurance company makes good the loss. The land value is not covered in this.
HOUSEHOLDER'S INSURANCE
There is the option of a householder's insurance. This covers the household goods such as TV, fridge, AC, jewellery, appliances etc. It is a comprehensive cover. It covers the risk of damage and theft of valuables, and also of a breakdown of domestic appliances and accidental breakage of glass fixtures.
The policyholder should in sure his home's contents for their full value. For insurance of breakdown of domestic appliances, the sum insured should represent the current e replacement value of a similar item. For the insurance of household items, one needs to group the items in a broad category like furniture, clothing, linen, utensils etc, and give a value equivalent to the market value.
INNOVATIVE SCHEMES
Banks have come out with new and innovative schemes jointly with insurance companies, and offer various products covering these risks.
The products are flexible and suit the requirements of a home loan borrower too. The insurance cover and premium can be a pure risk cover or cover both risk and investment objectives. The premium payable and returns vary accordingly.
Various optional add-ons can be combined including loss of employment, critical illness cover, term rider cover etal on payment of extra premium.
These optional benefits are available to customize the policy to suit the specific needs of the individual.
source: Jul 18 2015 : The Times of India (Pune)