Costs of living around the country are increasing, and as a homeowner, it seems financially irresponsible to not purchase a property insurance. It is important to protect your largest investment with insurance. In fact, a lot of homeowners around the globe are already doing so. Property insurance offers coverage against a lot of natural disasters including, but not limited to, monsoons and floods, fires, earthquakes, theft, and other weather-related damages. Regardless of your home’s size, location, and other security features that you may have added. Being a huge structure, homes have a lot of vulnerabilities; cover it with an earthquake or hurricane property insurance. A less known benefit of property insurance policies is its liability coverage clause. Many other forms of insurance policies including auto insurance include this provision.
HOW CAN ONE GET PROPERTY INSURANCE?
Property insurance is a legal document that binds the policy holder and the insurance company. The policy holder should pay a certain amount called the premium to the insurance company in exchange of which the company assures to pay for certain damages that may occur to the building. The kinds of damages and losses covered will be elaborately discussed in the contract, hence it is extremely important for the policy holder to thoroughly go through the document. There are lot of insurance providers available in current market. Its important to make a comprehensive analysis before choosing an insurance company. It will help you to live peacefully.
WHAT ARE THE DIFFERENT TYPES OF PROPERTY INSURANCES?
There are different types of property insurances based on what they offer to their customers. Depending on the typology of the building, the property insurance can also vary in what it has to offer. The basic type of insurance is the one taken by home owners which ensures to back them up against a specific set of damages like fire, floods, earthquakes, theft etc. If you are owner of a rental property, rental property insurance is what you’d opt for ensures to cover damages or losses that may made due to negligence by the tenants.
The terms of the policy may vary depending on the type of structure and the needs of the policy holder. Whether you are a home owner or a landlord, it is extremely important to get your property insured.
WHAT ARE THE TYPES OF INSURANCES AND BENEFITS OF GETTING YOUR PROPERTY INSURED?
Property insurance is like a safety at the time of damages that may occur to their property due to different reasons. Insurance usually provides cover under two main categories- hazards and liability.
Hazard insurance provides a policyholder against damages that may occur due to fire, vandalism, theft and similar mishaps. It could provide a cash value of the damages or their replacement value. The replacement value provides enough payment to replace what is lost or damaged. The cash value pays the policyholder the worth of the property.
Liability insurance provides cover against the accidents that may happen on the property. Medical expenses that one might have to bear due to damage to life on the property.
HERE ARE SOME ADVANTAGES OF INSURING YOUR PROPERTY.
- At times of calamities, property insurance that extends coverage for the same. The damage that may occur to a home can cause a huge burden to you if not for a good insurance that would cover the expenses to make repairs for the same.
- If you have liability insurance, and some accident happens on your property- you will not have to bear medical expenses for the same.
- If you are a homeowner who is renting out a property which is insured, the expenses to repair damages made by the tenant will not have to be spent by you.
- Damage due to vandalism, theft etc that may occur to a home or a commercial property will be taken care of by the insurance company.
- Some policies also cover the contents of the home like art, jewellery, electronics etc. Any damage or theft of the same will be taken care of the said insurance policy.
FACTORS TO KEEP IN MIND WHILE CHOOSING A PROPERTY INSURANCE POLICY.
There are many different insurance companies offering many options. It is necessary to study what they have to offer and decide accordingly. Few things a person have to bear in mind, one being the amount of insurance coverage that you are getting from a certain policy on your property. The second one is the amount of yearly premium that the policy demands you to pay. The third factor that you have to understand is the time taken when you claim for settle the procedure. Lastly and most importantly, you have to go through the list of events that the insurance will cover. The different incidents, natural disasters etc that will be covered by the policy. Like some regions may be more prone to floods, some others to earthquakes- ensure that your insurance provides you a backup for the same.
TYPES OF COVERAGE AND COMPENSATION
- Natural calamity and man-made destruction: Property insurance covers the damages from natural calamities like earthquakes, cyclones, floods and fire due to lightning. It also covers the man-made damages incurred through vandalism, fire, theft etc. Compensation is provided in both cases.
- Loss of assets: In addition to the protection of the property structure, it covers the loss of assets like furniture, electronic gadgets, jewellery, and other valuables.
- Liability protection: The liability to accidental damage to the third-party member (mostly tenants) caused by you in your property premise is also covered by your insurance provider.
- Temporary living expenses compensation: If you have to live on a rented premise when your damaged home is getting repaired, then you will be compensated for the temporary accommodation.
TYPES OF PROPERTY INSURANCE
To suit the varied needs of every home buyer, insurance companies offer a broad range of home insurance policies and schemes.
- Insurance of structureThis insurance policy can only be bought by the property owner and not a tenant. It covers the structural damages of the property and if any outhouse, sheds, garage is attached to the property.
- Insurance of property contentsAs mentioned above this policy covers the loss of personal assets and belongings like electronics, furniture, jewellery, etc. This type of insurance can also be bought by a tenant.
MERITS OF PROPERTY INSURANCE
A small amount of premium covers a big amount of loss that happened through any event. Below are some merits of property insurance.
- Your property contents and structure are covered comprehensively.
- It comes with a much lower premium compared to other types of insurance policies.
- It is like a one-stop-shop as a fail-safe mechanism.
- A well-researched insurance policy bought will help you to restore your property and normalize your life pretty fast.
DAMAGES WHICH ARE NOT COVERED IN PROPERTY INSURANCE
A comprehensive insurance policy also has its exclusions of coverage. However, this may vary from company to company. Few are listed below.
- Terrorism acts
- Military attack or civil war
- Wilful destruction
- Property wear and tear
- Not occupied for a long period
- By termites and other minor internal damages
It is always better to have your property insured not just limited to the insurance benefits but an advantage while opting for a mortgage loan. Last but not least, buying a property insurance policy gives you security and complete protection from unpleasant damaging events and helps you to restore your peace of mind.
