Property is one of the most sought after investment and indeed deserves insurance. Property insurance may sound a bit redundant type of insurance but actually it is not. What if your house catches fire or witnesses damage due to earthquake or becomes the victim of some other natural or man-made calamity? The mere imagination of bearing hefty expenses if the house encounters serious damage is enough to send goose bumps. So, the best resolution is to go for home insurance cover.
Major highlights of home insurance cover:
Protection for house structure
Protection for household valuables
Optional coverage for theft/larceny
Features of property insurance:
Basically there are two factors that can result in structural loss and contents loss
a.Fire break out and other perils: In such a scenario the protection is provided against:
Fire, explosion, aircraft damage, damage due to missile operation
Riots, Damage due to terrorism
Tornado, Cyclone, Storms, Landslides
Earthquakes, Volcanic eruptions
Damage occurred due to vehicle or animal
b.Theft and Larceny: This covers the loss occurred to the contents placed inside the home:
Valuables kept inside a safe within the premises
Other contents such as furnishings for which insurance is seeked
Factors determining the sum insured in property insurance:
Reinstatement Value (for structure): At the time of property insurance, the sum insured is determined on the basis of reconstruction cost of the house keeping in mind the occurrence of eventuality such as flood, fire or storm.
The reconstruction cost is determined by the cost of establishing a structure taking into account built up area. The note worthy point is that cost of land is not included but the follwing two factors are considered:
Built up area of your home
Construction cost in your locality
The reinstatement value is determined by multiplying the built up area of your home by the per square feet cost of construction.
Market Value (for contents): The valuables or contents are measured on their market value. At the time of insurance, the market value is judged and if a loss occurs the market value is paid minus the depreciation amount.Homeowner's policy is referred to as a multiple-line insurance policy, meaning that it includes both property insurance and liability coverage, with an indivisible premium, meaning that a single premium is paid for all risks.
General Exclusions of property insurance:
Intentional damage to property by self
Damage occurred due to warfare
Losses caused if your house remains unoccupied for the specified time as provided in your policy, without intimating your insurance provider.
Major highlights of home insurance cover:
Protection for house structure
Protection for household valuables
Optional coverage for theft/larceny
Features of property insurance:
Basically there are two factors that can result in structural loss and contents loss
a.Fire break out and other perils: In such a scenario the protection is provided against:
Fire, explosion, aircraft damage, damage due to missile operation
Riots, Damage due to terrorism
Tornado, Cyclone, Storms, Landslides
Earthquakes, Volcanic eruptions
Damage occurred due to vehicle or animal
b.Theft and Larceny: This covers the loss occurred to the contents placed inside the home:
Valuables kept inside a safe within the premises
Other contents such as furnishings for which insurance is seeked
Factors determining the sum insured in property insurance:
Reinstatement Value (for structure): At the time of property insurance, the sum insured is determined on the basis of reconstruction cost of the house keeping in mind the occurrence of eventuality such as flood, fire or storm.
The reconstruction cost is determined by the cost of establishing a structure taking into account built up area. The note worthy point is that cost of land is not included but the follwing two factors are considered:
Built up area of your home
Construction cost in your locality
The reinstatement value is determined by multiplying the built up area of your home by the per square feet cost of construction.
Market Value (for contents): The valuables or contents are measured on their market value. At the time of insurance, the market value is judged and if a loss occurs the market value is paid minus the depreciation amount.Homeowner's policy is referred to as a multiple-line insurance policy, meaning that it includes both property insurance and liability coverage, with an indivisible premium, meaning that a single premium is paid for all risks.
General Exclusions of property insurance:
Intentional damage to property by self
Damage occurred due to warfare
Losses caused if your house remains unoccupied for the specified time as provided in your policy, without intimating your insurance provider.
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