Home is the most valued asset for a large part of Indians. Our love for real estate is well known. But, what you have done to protect your home, the biggest asset of your portfolio? What will happen to your investment when there are any natural calamities like earthquake, Tsunami, Cyclone etc.
What will happen if the building collapses due to structural problem or fire catches the building? If these unwanted events happen, it will be very difficult to build another house or cover up the financial losses. To eliminate this risk, you can have a home and content insurance which can take care of all the uncertainties about your dwelling unit.
The following reasons are why you need home insurance.
1. Protection of Investment
As mentioned earlier, the house is the biggest investment one have. The protection of that investment is to be ensured. The best way to way to protect the investment is insurance. If your home is damaged or destroyed due to natural calamities, fire etc. the entire investment will be gone. Again you have to invest to buy or build a home which involves high cost. It may not be easy to buy a second home if something happens. That’s why, take an insurance cover for your home.
2. Protection of Valuable Items
The home insurance has two parts. One is the protection of construction of the home and another is the contents inside the home. The contents may be costly home appliances, furniture etc. One can have insurance coverage for all the costly belongings inside the home along with the home insurance. You have to declare the properties or belongings to the insurance company. The insurance company will cover it after the proper valuation of the things.
Also Read: What to Take Care Before You Buy Car Insurance Online
3. Home Loan Protection
You face a situation when the bank is pushing you to buy a home insurance plan for your home mortgage loan. Generally, banks and NBFCs which give home loans now have started selling home insurance plan with the home loan. It covers two aspects. One is the death of the person who has taken the loan and another is the protection of investment.
You can address the first aspect by having a term insurance in your name. In that case, the cover of term insurance should have included the cost of the outstanding home loan. For the second aspect i.e. protection of investment, you need to have home insurance. It covers the home from all the natural calamities and man-made disasters. If your house is destroyed due to natural calamities and you have to rebuild your home, the home insurance cover will help you to build another home and at the same time, you will be saved from being a defaulter of the loan.
If your house is destroyed due to natural calamities and you have to rebuild your home, the home insurance cover will help you to build another home and at the same time, you will be saved from being a defaulter of the loan.
Also Read: Five Reasons Why You Should Not Prepay Home Loan
4. Protection from man-made risk
Home insurance gives you the protection from man-made risks such as theft, burglary, terrorism, riots, strikes etc. If you are on a holiday with family, the house is empty. It has a high chance of theft, you know that. A home insurance covers 30 to 60days, even there is no person in the house. You can enjoy your holiday full without thinking about your home if you have home insurance in the above cases.
5. Interim Housing
Suppose your home is damaged due to natural calamities and you have to repair your home. You need to move out from the home. The rental for the interim housing is taken care by home insurance companies. Be careful when you are buying the insurance. Read all the terms and conditions before buying the policy.
The home insurance is a very necessary cover for all those who have invested in the home. This high investment is to be protected by all means.
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