Home insurance is the protective shield you can purchase for your home. In the case of any damage to your house, the home insurance will come to your rescue so you can handle the repairs and related costs. However, there are many types of home insurance available in India. One such type is home content insurance.
What is home content insurance?
Not just the structure of the house, even the items inside the house need some security. You might have purchased antique interior pieces, high-end gadgets and electrical items, huge television sets, best-in-class furniture, and other items to upgrade your home. It is equally necessary to protect all these items through home content insurance.
Otherwise, you will have to find funds to purchase all the household items again from scratch if any mishappenings, such as fire or flood, damage the home content.
When it comes to the insurance companies, the definition of home content is something on the lines of the sorts of things you would carry with you when you move houses.
What are the types of home content insurance?
Like New or New for Old:
In this type of home content insurance, the insurer will reimburse the complete cost of repair for the item if there is any damage to the covered item. On the other hand, if a covered item is robbed, reimbursement will cover the cost of buying a similar new item. Though the content covered for such insurance varies from insurer to insurer, clothes and apparels are not generally covered under this category.
Indemnity Policy:
Such home content insurance comes at cheaper premiums as the insurer considers the cover item’s wear and tear and depreciation in its value before deciding on the reimbursement. For example, claiming reimbursement on a 5-year old smart TV depends on its current value and not the purchase price.
For Owners:
Say you are a house owner and have let-out your semi-furnished/fully-furnished house for rent. Numerous tenants may come and go; the electronic and electrical items installed in the house have to function well. Therefore, you can buy this home content insurance for owners to secure the house content even if it is not you who is using them.
For Tenants:
Though the tenants do not own the house, they own the house content and require security towards them. This type of home content insurance covers the home content and is specially designed for tenants and renters.
Quicks tips on home content insurance
- Try to note down the actual value of all the items in your house. It is vital to quote the right insured amount for your policy.
- In the event of claim settlement, the maximum amount your insurance policy will reimburse will not exceed the sum insured.
- There is an option to extend your policy to avail additional cover, which comes at an additional premium.
- Monthly direct debit can often lead to additional charges. Annual payment can be a better option.
- It could be cheaper to buy both home insurance and content insurance from the same insurer.
- Remember to encash your no claims discount at the time of policy renewal if you haven’t filed for any claims so far.
- Houses equipped with security features, such as CCTV and burglar alarms, can be insured at cheaper premiums.
Though home content insurance is not yet popular and common, it is always good to take precautions rather than regret it later.
For any clarifications/feedback on the topic, please contact the writer at apoorva.n@cleartax.in
