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Why Home Insurance Is A Must For Tenants

IndianMoney.com Research Team | Posted On Monday, February 18,2019, 03:40 PM

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Why Home Insurance Is A Must For Tenants

 

 

What is Home insurance?

Householders Package Policy is a form of property insurance which covers damages to the structure and contents of your house.

If you avail a home loan to buy house, the lender may insist on home insurance to protect your home, in case of damage caused by unforeseen circumstances like fire or natural disasters.

A home insurance policy is a must have and provides the following benefits:

  • Provides cover for the structure of the house.
  • Secures the assets and the contents of the house.
  • Provides cover for burglary, fire, earthquake or destruction of house due to riots.

Why do you need home insurance as a tenant?

A tenant can also avail home insurance, but only home content insurance. The tenant can do so to protect his assets and belongings in case of any mishaps. If any damage is caused due to the negligence of the tenant, then he will have to bear the cost of repairs.

The home insurance is a comprehensive insurance plan that offers coverage for both the structure of the house as well as the contents present within.

Currently there is no proper home insurance policy for tenants in India. But, if you want to insure your assets and personal belongings, then you can avail tenant legal liability cover. However, the price and the coverage may vary across lenders. Some private insurers offer this insurance like Bharti Axa, Future Generali and ICICI Lombard.

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SEE ALSO:Frequently asked questions on Home Insurance

Why Home Insurance Is A Must For Tenants?

Exclusions in Home Insurance:

Most of the home insurance policies have certain exclusions. Listed below are the most common exclusions:

  • Loss or damage caused by natural wear and tear.
  • Loss of cash.
  • Loss or damage caused by war, invasion, acts of aggression by a foreign country.
  • Loss or damage caused by nuclear war.
  • Loss, destruction or damage caused to any electronic equipment due to over-running or excessive pressure.

What are the benefits of availing a home insurance?

A home insurance policy comes with added benefits and riders that add convenience to life and finances. Given below are some of the benefits of availing a home insurance:

  • Home insurance covers both the content and the structure of your home.
  • The insurance secures the home from fire and allied perils.
  • The insurance policy can be availed at comparatively lower premium than other insurance policies.
  • Timely insurance payouts allow families to go through the rebuilding process quickly, helping move on and get back to daily life and routine.

SEE ALSO:Review Your Insurance Plans With IndianMoney

What should you look for when considering tenant insurance?

There are some important features that you must consider before purchasing tenant insurance. Listed below are some features of a tenant insurance policy that you must ask of your insurer:

  • Coverage: Home insurance policies cover liabilities arising out of damage to the house and/or its contents due to natural calamities like floods, fire, lightning, or even theft and an earthquake.
  • Replacement cost: a home insurance not only provides cover for the residential house, but also covers damage or loss by natural and manmade perils. A policy holder can also make claims for replacement/repair of furniture or assets or any damage caused to the insured property.
  • Exclusions: before purchasing a home insurance plan, you must check the exclusions. This helps avail a policy according to the geographical needs of the residential area. For example, if you are availing a policy where floods are not covered and you live in a flood prone area, then your policy is of no use.
  • Additional living expenditures: In case your house has to be reconstructed or repaired, you might have to shift. Your home insurance policy must cover for rent. So, go through your home insurance policy carefully and check if additional living expenses are included.

SEE ALSO:Term Insurance for Home Loan

Important Points to remember:

Given below are some important points that a tenant must follow while renting a property or house:

  • You must treat your rented accommodation as your own house. Be careful and responsible. In case of negligence, the resulting liability may fall on your shoulders and that may be too heavy an expense to bear.
  • You must respect the asset of your landlord. To protect it from harm as well as save yourself from heavy expenses in a mishap, you can buy tenant’s legal liability cover.
  • Buying home content insurance can save you from heavy expenses in case of damage or theft. 

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