Home Insurance Queries
POSTED BY
Sambaran Mitra
ON
December 14, 2010 8:19 am
My apartment is one flat in a high-rise with large number of apartments. A few questions regarding this:
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Does it make sense to go for home insurance at all as an individual? If the whole building comes down will insurance company pay me individually? Or is it only the association that can go in for insuring whole of apartment?
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Generally any commercial activity is not allowed for claiming insurance. I can guarantee that no commercial activity goes in my individual flat. However if my neighbor is conducting tuition classes at her home, or some bharatnatyam-classes are going on in the club-house, can these incidents be used to reject claim on behalf of my flat?
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How much should one insure the home for? I am NOT talking about insuring the contents within home. I bought an apartment for 20 lakhs in 2004. Now the apartment may be priced around 45 lakhs. Can I go for a home insurance of 45 lakhs? At the time of claim will questions be raised about correctness of this 45 lakh pricing? How do home insurance companies determine that pricing is not outlandish? If I had insured the home for 1.5 crores, will the insurance company pay me 1.5 crore (say in case of complete destruction by earthquake) just because I paid the premium?
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Are there any IRDA pointers where we can check the claim settlement history of housing insurance companies?
I have a query on the Home insurance. In case your house/apartment has the risk of any damage (partly or fully) because of any road widening in future (if the house falls near by main road), does the insurance covers this aspect as well?
Do they pay for reinstatement of the partly damaged structure?
1. Assume I have a policy from company X for a duration of 5 years. At the end of 5 years, what are the advantages in continuing with company-X? Conversely, what are the disadvantages of switching to company-Y at the end of 5 year tenure? Is the difference only in premium amount?
2. What is the exact link at irda website for checking the claim history of home insurance companies?
Sambaran,
1.Having an apartment is not complicated from home insurance point.Remember they are covering your house on reinstatement basis.So own house or apartment, in any case cost of land is not covered.
2. the problem is you are not aware what will be the construction cost when any un forseen happenings takes place.So if construction cost comes to be higher then what you have taken, you probably are under insuring. today 10 lakh can go upto 35 lakh after 10 years.but if you cover only for 20 lakh on your calculation, you are underinsured.So better to take a higher cover and probably go near to market value.
3.i will give you specific link.
4. my source is Insurance companies i have tied up with and have given home insurance to few of my clients after a detailed study.
i hope it answer some of your doubts.
Hi Jitendra, Thanks. Some follow up questions:
1. I am pretty convinced that insuring house is necessary. My concern is whether having an apartment in a building (rather than having own house on a plot of land) makes it complicated from home-insurance purpose.
2. If company is paying me on re-instatement basis why does it leave me the option of chosing my coverage. If I go for 1.5 crore for a 2BHK apartment, surely the company will not pay me 1.5 crore. So there must be a mechanism to calculate how much coverage one should realistically go for based on location, area etc. I wanted to know that mechanism.
3. IRDA.gov.in is as usual a very ‘governmenty’ website meaning extremely difficult to navigate. I had unsuccessfully tried searching the website for general insurance claim history. Can you send me the specific link, if you have it?
4. Good to know that activity in adjacent flat will not affect my claim. May I know what is source of your information?
Thanks once again for the time you took to respond to the query.
Hi sambran,
Firstly, yes you should go for insurance for anything which is an asset for you and a loss of the asset can severely impact your Financial situation.So go ahead and insure your house.
Now, on what basis company insure house.If your house is worth 45 Lakh today, you can insure it for 45 lakh.The company will pay as per reinstatement basis.Which means, the company pays you the cost of reinstating the property of the same kind or type by new property.
For checking claim history of general insurance companies, visit http://www.irda.gov.in.
If any activity is going in an adjacent flat, the company will not reject your claim because they are paying you the construction cost.