When it comes to home insurance, there are a million question which might arise in your mind. Here are a few commonly asked questions pertaining to home insurance, answered for you.
- Who is eligible to purchase a Home Insurance policy?
Any individual who is a resident of India and is the owner or occupant of a property, can purchase a home insurance policy. Also, individuals who are living in a rented accommodation may also apply for a home insurance policy.
- What are some factors affecting the premium on a home insurance policy?
Following are some factors affecting the premium on your homeowner insurance policy.
- Location – The location of your house can also affect the premium rates. For example, your house is located in an area frequented by storms, hurricanes, cyclones etc., or in close proximity to a flood prone water body, in a region experiencing frequent earthquakes or in a neighborhood where theft, robberies and other such activities are rampant.
- Features & Characteristics Of The House – Factors like the age of the house, structure type, roof, wiring, and garage can affect the premium amount. The older the house, the higher it might cost to insure it. Also, the materials your house is made of - brick, stone, frame or synthetic siding - can also affect your premium amount.
- Personal Factors — Often, personal factors like your credit history and lifestyle habits can also affect your house insurance premium. For example, a smoker may pay more towards their home insurance premium than a non-smoker would. Also, a good credit history can help lower your insurance premium.
- Installation of Protective Devices - Installation of protective devices like smoke detectors, fire alarms, deadbolt locks, burglar alarm systems, sprinkler systems, fire extinguishers, etc., can also help bring down the premium amount as all of these contribute to the safety of your house.
- Claims History — Your claims history or can lower or increase your premium. If you do have a claim history, you may pay a higher premium, than if you don’t have one.
- Is the commencement date of an insurance policy?
Your insurance policy will commence either from the day the company receives the first premium installment or from the date as chosen by you.
- What are the documents to be submitted in case a burglary takes place?
In case of a burglary claim, you must submit the following documents:
- The original invoice stating the value of the items stolen.
- Cost of repair / replacement of the stolen items.
- First Instance Report (FIR).
- Duly filled Claim Form.
- If the insured house is sold, what happens to the home insurance policy?
In case the insured house is sold, the policy stands cancelled from the moment the transfer of ownership of the house takes place and the insured ceases to be covered under the policy. Following this, the balance of the premium for the remaining insured period shall be refunded to the policy holder.
- What does it mean by canceling and non-renewing a home insurance policy?
Non-renewal of a policy can either be done by the insured individual or the company. In this case, the insured person is no longer covered by the company. If the company decides to not renew your policy, it must do so with an explanation within a specified time period. You may also challenge this decision by taking the matter up with the company’s customer service department if you are not entirely convinced with the decision.
Cancellation of the insurance policy too can be done by the policyholder or the company. Usually, an active policy is cancelled by the company if:
- The applicant has made gross misrepresentations or committed serious fraud on their application.
- Policy holder has failed to pay the premium due.
- If the policy has been active for a period of less than 60 days.
- What happens after a home insurance claim is registered with a company?
Once you have registered for a claim with your insurance company, a surveyor will contact you, usually within the next 48 hours. Also, a claim form shall reach you within the next few working days.
- What are the most common exclusions to any home insurance policy?
There are some exclusions which are common to most home insurance policies . It is important that you carefully review your insurance policy wordings to find out exactly what kinds of perils your policy does protect you against and what it doesn’t cover. Do also remember, that the policy will have specific limits coverage of items like jewelry, silverware, securities, money, etc. Some of the most common exclusions to a home insurance policy are as follows:
Most home insurance policies do not cover animals, birds, and fishes.
Any loss of damage caused due to surface water, flooding or water backed up through drains /sewers.
- Any physical damage or bodily injury resulting from an intentional act of the insured.
- Movements of the earth.
- War, nuclear damage, etc.
- Business property & automobiles.
- Any loss or damage caused due to the operation / ownership / use of any automobile, aircraft, watercraft and recreational motor vehicle with a motor capacity exceeding 50 Horsepower.
- I have taken home insurance policies with two companies. What happens in case of claim settlement?
In case you have taken home insurance policies from two different companies, you will be paid on a proportionate basis in the event of a claim being made.
- What are some of the cases when the insurance company can cancel the coverage during an on-going policy?
The insurance company can cancel your existing policy under any of the following circumstances:
- Failure to pay premium.
- Fraud or material misrepresentation.
- Any illegal / hazardous acts increasing the hazard insured against and result in conviction. Example, conviction for illegal possession of fireworks.
- Any physical changes occurring in the insured property and making it uninsurable. For instance, a house / property lying vacant for a long period, say 60 days or more, is exposed to a greater risk of being vandalized or damaged.
- Any willfully reckless acts or omissions made by the insured which increase the risk of any hazard which the property is insured against. For instance, not getting a gas leak repaired.
- Decision made by the Insurance Commissioner that continuation of the policy would place the company at risk due to violation of the law.