The Home insurance sector in India is at a nascent stage as compared to other insurance sectors in the country.

With the real estate boom at its prime in India, home finance has become an indispensable part of real estate functioning. Moreover, the housing finance companies (HFCs) are also playing an important role in the evolvement of the home insurance company in India. Due to the new regulations by the finance companies making home insurance mandatory for seeking home loans in India, the home insurance sector has recently seen massive revival in business. Industry analyst say that, if the home loans and insurance sector continue to facilitate each others growth, then the insurance segment is soon set to achieve a 100% growth. The latest growth curve shows the home insurance premium touching the Rs 150 crore-mark, registering a growth of 25% in the last financial year; and if the situation prevails, the trend is predicted to continue. As the growth curve of investments in Indian real estate sector escalates, more and more insurance companies are making their foray into the home insurance sector. This has also initiated a trend of insurance companies from across the globe making their foray into Indian market either as individual entity or in joint ventures with the local existing insurance companies. Home insurance and real estate has of late become conspicuous of the buzz it has created in the realty industry in India. Adding to the list of leading and existing public sector companies in the home insurance business like New India Assurance, Life Insurance Company of India, United India Insurance, Oriental Insurance and National Insurance Company; is a list of private insurance companies which are set to play a pivotal role in the growth of the sector. The most thriving amongst those are mostly joint venture companies like ICICI Lombard General Insurance, Bajaj Allianz General Insurance, Tata AIG General Insurance Company Ltd, IFFCO-TOKIO and Royal Sundaram Alliance to name a few. Considering the feasibility of a largely huge and growing market, the home insurance sectors has lately expanded its business beyond the metros to the Tier I and II cities where real estate development is expected to flare up in the years to come. The booming real estate sector in India is considered to be one of the most encouraging factors in the resurgence of the home insurance sector. However, apart from the real estate factor, the recent spate of calamities that has hit the country like the earthquakes, tsunami, the consistent flood every year in most parts of the country and the exceptional cases of 'deluge' in Mumbai in 2005 has made people opt for home insurance like never before. Besides that, the home insurance companies are also providing their customers with attractive policy plans to suit their needs and budget.

Importance of Home Insurance

Home Insurance has evolved as one of the most enterprising sector in the real estate scenario in India. As more and more investments are made in the real estate sector, there has been a rising demand for home finance and home insurance simultaneously. The importance of home insurance in the protection of your house and valuable possessions is as importance as protecting your family from any hazards that act as threat to life and property.

HOME INSURANCE IN INDIA

Importance of home insurance Types of home insurance

The policy provided by the home insurance companies act as a guarantee that combines insurance of the home, its contents the personal possessions of the homeowner, risk attached to burglary; as well as liability insurance for accidents that may happen at the house like fire and natural calamities. The extent of the risk covered however depends on the type and content of the policy. A generally configured home insurance policy usually covers calamities in two categories - natural and man-made. Natural Calamities Eartquake Fire Lightning,Storm Cyclone Flood Tsunami Landslide Man-Made Calamities Burglary Terrorisn Riot Strike Malicious Damage Aircraft Laws Impact from RAil/Road vehicles

Home insurance is important as it not only provides you with financial protection against any damage your property might incur - to both your buildings and the contents; but it can be considered a small amount of money you pay in lieu of the peace of mind that brings with it and the content that your property is insured and protected against all hazards. Though the importance of having a home insurance policy cannot be over emphasized, one cannot predict any disasters or unavoidable incident that might happen to one's home.

Home insurance not only protects the homeowner from total loss when disaster occurs, but also protects the home owner in the event that their home is damaged by acts of God or if a person becomes injured, the home owner will not be held solely liable for all of the damages. The home insurance policies usually cover a home under the all risks clause unless otherwise noted in an exclusion clause. For instance, a home can be covered for fire damage, earthquake damage, and acts of vandalism under an all risks policy, but if the policy states that the home is not covered for deluge or say tsunami, than water damage due to the mentioned natural calamity would not be covered. To summarize it, the home insurance policy is important for the homeowner as it ultimately gives the home owner a sense of security to protect his family and property against calamities.

Home insurance in India has a key role to play in the protection of your house or building structure and valuable possessions or building content. Home insurance policy is a guarantee provided by the insurance company that combines insurance on the home, its contents the personal possessions of the homeowner, as well as insurance covering accidents that may happen at the house like fire and natural calamities. The coverage of the risk however depends on the type of policy. There are mainly two types of home insurance in India.

Building insurance Content insurance

Buildings Insurance Buildings insurance is an important part of property investments. The mandatory obligation made by the housing finance companies has strengthened the need for insurance in conjunction with property investments. Insuring the building or building structure is important since it protects you against inevitable losses in case your building is destructed and debilitated in any natural or man-made calamities. The housing finance companies are insisting on building insurance so that in the event of a disaster it can be repaired or rebuilt, as lenders don't want to be left without security for their loan. A home insurance policy should cover expenditure to rebuild your home in the event of it being totally destroyed or damaged to the point that complete rebuilding is necessary (in eventualities like earthquake, fire etc). Different home insurance companies have different specifications for policy coverage. It is recommended that you check the terms and conditions of the policy. Home insurance companies in India mostly have home insurance plans that insure the building structure of your home for its reconstruction value. This is the cost incurred to reconstruct the home if it is damaged and not for its market value such as the cost of land etc. Sum insured is calculated by multiplying the built up area of your home with the construction rate per sq. feet. Home insurance plan for buildings are usually meted out on conditions as per the policy terms arising out of conditions like

Fire, Lightening, explosion of gas in domestic appliances Bursting and overflowing of water tanks, apparatus or pipes. Riot, Strike, Malicious or Terrorist Act Flood, Inundation, Storm, Typhoon, Hurricane, Tornado or Cyclone Damage due to earthquake, subsidence and Landslide (including Rockslide). Damage caused by Aircraft & Impact damage Third party liability and personal accident.

Content Insurance Content insurance may be considered optional but with the threat of burglaries, natural disasters and fire, content insurance covers are rising in demand. Contents insurance for home insurance plans includes protection to movable goods,

possessions or contents in the house; anything that is not a fixed parts of your home, for example your appliances, electronic goods, furniture and clothing. Similarly as the modalities adopted in building insurance, different home insurance companies in India have different policies for content insurance. Most companies comply with insurance plans where a value equivalent to the market value of household contents i.e. the value for which this used item could be bought or sold in the market is covered as insurance. The insured amount given against the perils for building or structure and its contents is assessed either on 'reinstatement value' basis -which is the value for replacing the item with a new item of same type and make; or on 'market value' basis -which is the reinstatement value less depreciation depending on the age of the item. Content insurance offers protection against various perils including:

Fires Storms/flooding Explosions Theft and vandalism Valuables such as jewellery, cameras and watches against all risks, Cover against all kinds of accidental breakage of plate glass fixed in doors and window frames. Loss/damage to domestic appliances due to electrical and mechanical breakdown.

Home insurance can be availed for both building and content combined. However, most home insurance plans in India excludes underinsurance of the property value, willful destruction of property, loss, damage or destruction caused by war perils, wear and tear and atmospheric conditions etc., damage due to an act of terrorism(unless specifically covered) and losses or damages incurred when premises are unoccupied beyond 60 consecutive days.

Home Insurance Basics

If you plan to invest in home or property, you must have basic knowledge in home insurance basics or you should know how to choose the right home insurance. Home insurance is undisputedly the best way to keep your house and valuables covered and secure for a long period of time. Before applying for Home Insurance, you should read up some Home Insurance FAQs that can provide loads of home insurance information. It not only provides you peace of mind but also secures your property from future financing loss if any, due to a number of reasons.

HOME INSURANCE BASICS

Home insurance claims - Procedure - Documentation Choosing the right insurance

There are many public and private sector home insurance providers in the Indian market offering different plans for home insurance. General Insurance Corporation of India through its subsidiaries like United India Insurance, Oriental Insurance, the National Insurance Company, New India Assurance, etc, are few of the known names present in this insurance sector to provide you guarantee for your coveted property. Also there are several companies in private sector which offers Insurance schemes such as Royal Sundaram Alliance, ICICI Lombard, Tata-AIG, Bajaj Allianz General Insurance Company etc. They provide their customers with instant home insurance quotes. You can even compare them to arrive at a decision. There are lots of schemes available in home insurance depending on the coverage options available for 10 sections. This coverage in sections varies from private to public sector insurance firms as per their clause. House holder's policy has to be renewed every year. If you take 5-6 sections, you are entitled to a 15 per cent discount on the premium on the optional sections and for taking more than seven sections, you get a 20 per cent discount on the premium. The 10 Sections include Basic Policy (Fire Coverage) has two subsections- one covers the building and the other its contents against damage from fire and allied perils, specifically structural and other damage from fire, lightning, riots, explosion of gas in domestic appliances, riots and natural calamities such as floods and earthquakes. This policy excludes jewellery and valuables

Cover for loss/damage due to Burglary excluding jewellery, gold and silver articles, securities, cash-and televisions and bicycles which are covered under other sections.

Cover for 'all risks' against loss or damage to jewellery and valuables

Cover for damage or loss to fragile items like glass ware including plate, glass etc.

Cover for accidental breakdown of electrical, electronic and mechanical gadgets like refrigerators, airconditioners, microwave ovens, washing machines or motor pumps

Cover for loss / damage to television sets, VCDs/VCRs/VCPs and computers against all types of risk-fires and allied perils, theft and accidental breakdown.

Cover for loss or damage to a bicycle

Cover for loss of or damage to baggage while you are travelling in India

Cover for personal accident

Covers your legal liability to a third party for personal injury or property damage

Besides the House holder's Insurance policy, there is also an exclusive Fire Policy for covering the building and contents against the perils of fire, lightening, floods, earthquake, storm etc. This policy can be taken for a period of five or ten years. The longer is the term of the policy, the more is the discount on premium.

Home Insurance Claims

Insurance claim amount is always something creeping up on the mind of both insurer and the insurance company. It is more evident in case when there is a possibility of you filing a claim to recover the amount for that claim. If you provide sufficient proof and necessary documents for your home insurance claim, there is a fair chance you can get

the amount by the Home Insurance company or provider. Also, submitting a claim on your home policy is a relatively quite simple process. The steps involve contacting your agent, filling out a claim form and waiting for an appointed arbiter to verify the facts and judge the authenticity of the damage. If the damage is really worth notice, it's a matter of few days to get the claimed amount through check. Most claims are handled quickly. HOME INSURANCE BASICS Sometimes the claim process can really be time taking and frustrating. Also keep in mind that most insurance providers don't enjoy the idea of two or three claims in a short span of time and you stand almost certain chance of getting cancellation of these claims. Try to stay away from high risks, so you should be sure to make only those claims that are absolutely necessary. Or, if you are sure about your rights to claim and corresponding damage or loss, just go full throttle to register a claim. Only remember that there can sometimes be unpleasant repercussions. Here are some general tips for handling auto and home insurance claims:

Home insurance claims - Procedure - Documentation Choosing the right insurance

Know your policy. Stake your claim quickly. Avoid using the word "lawyer." Keep a copy of the police report. Get an estimate or two. Make temporary repairs.

Home Claim Procedure

Inform the call center with policy details. Provide relevant information, which includes your policy and other details regarding your claim. Consequently, your claim request is authenticated and is escalated to the company's claims department. Company's claims department validates and registers the request. They appoint a surveyor within 48 hours. The insured submits all the relevant documents to the surveyor. The surveyor submits the Final Survey Report (FSR) along with the documents within 7 days. If surveyor is not appointed, the company's claims department sends a letter of requirement for submitting documents to the insured within 24 hours of claim intimation. On receipt of documents, the claims department processes the claim within 7 days. On approval of the claim, a letter is send to the insured giving the approved amount of settlement along with the discharge voucher. Payment cheque is released on receipt of the signed discharge voucher.

Documents Required Documents are the most valid and appropriate proof for your home insurance claims. Always keep your documents in place and ready both before you need to make a claim and when you need to make one. It is always advisable to save the receipts for items you buy. This will give the indication and estimation of the total cost of items and damage claim amount accordingly. Photographs and/or videotapes of your home (both in pre- and post-disaster form) can also be beneficial. These will help you establish an inventory of your belongings should the need arise. Always save photos or videos of the damage before you begin cleaning up. List of Documents Required 1. 2. 3. 4. 5. Duly completed and signed claim form Xerox copy of policy Copy of FIR Final Report from police Copy of all invoices, price lists, repair estimates

Please note that this is an indicative list and some other documents may be required at the time of claim settlement.

Choosing the right insurance

Home insurance coverage is the most vital thing to consider once you have purchased a property. There are range of Housing Finance companies, Indian banks and private firms offering home insurance coverage for property in the market. The prominent names providing home insurance coverage are Bajaj Allianz General Insurance, ICICI Home Insurance, National Insurance Company, PNB Housing Finance, Royal Sundaram Insurance, The Oriental Insurance Company, United India Insurance and many more. HOME INSURANCE BASICS While choosing for right home insurance coverage, you must compare different home insurance claims and policies offered by lender banks and companies. You should check policy coverage for what all benefits you are going to accrue while opting for any specific home insurance policy. In case if you consider ICICI Lombard Home insurance, you will get the following benefits as policy coverage. Similarly, other home insurance providers offer you different coverage for a period of time. Policy Coverage You can choose to buy insurance for only the building (structure) of your home, or only the contents (belongings) or both.The policy covers the losses to the structure and contents of your home due to any natural and man made calamities. The calamities covered are:

Home insurance claims - Procedure - Documentation Choosing the right insurance

Fire

Riot, strike & malicious damage Explosion & implosion

Earthquake

Lightning

Storm, cyclone, tempest, tornado, hurricane, flood & inundation

Damage due to impact by vehicles

Missile testing operation Subsidence, landslides and rockslides Leakage from automatic Sprinkler installations

Aircraft damage. Bursting and/or overflowing of water tanks, apparatus and pipes

You can use the Home Insurance Premium Calculator to calculate the premium required to be paid after calculating the accumulated total of the annual liabilities. Also, learn the things that are covered by the Home Insurance companies and the ones that are not. Burglary covers (only for contents): The contents of your home are also covered against loss due to burglary or an attempted burglary. It also covers loss of jewellery, silver articles and precious stones kept under lock and key, up to 25% of the total content sum insured or Rs. 1 Lac, whichever is lower. Additional expenses of rent for alternative accommodation - If you are forced to shift into an alternative accommodation because your home is destroyed or damaged by any insured peril, the policy will cover you against the additional rent. The maximum coverage is up to Rs. 1,00,000 for up to 6 months. The cover is available only if you are insuring the structure of your home.

S.No 1.)

What is covered by the Policy? Building

What are the risks covered? Fire, Lightning, Explosion, Implosion, Aircraft or articles dropped from there, Riot, Strike or Malicious Act, Terrorism, Earthquake Fire, Shock, Subsidence and Landslide (including Rockslide) damage, Flood, Inundation, Storm, Tempest, Typhoon, Hurricane, Tornado, or Cyclone,) Impact damages,1B Contents Subsidence and Landslide including Rockslide) Bursting and/or overflowing of(Excluding money and valuables) Water tanks, apparatus, and pipes, Missile testing operations, Leakage from automatic sprinkler installations, Bush Fire Burglary, Housebreaking, Accident misfortune anywhere in India Burglary, Housebreaking, Accident misfortune anywhere in India Accidental breakage Electrical accident or mechanical breakdown or or or

2.) 3.) 4.) 5.) 6.) 7.)

Contents Jewellery & Valuables Fixed Plate Glass Domestic appliances Domestic Electronic equipment Cancellation of Vacation

Total loss from electrical or mechanical breakdown or accident Forfeiture of monies paid to hotels/resorts due to illness, death or loss of homedue to fire & allied perils Loss or damage while traveling in India Loss of life (up to 4 persons) repatriation of mortal remains and

8.) 9.) 10.)

Baggage Personal accident Pets(if Any.)

Loss of life by accident, surgery or disease

S.No 1.) 2.) 3.)

What is not covered by the Policy? Loss, destruction or damage, caused by war, invasion, act of foreign enemy, hostilities or war like operations. Loss or damage caused by depreciation or wear and tear. Loss or damage directly or indirectly caused by or arising from or in consequence of or contributed to by Nuclear weapons material, or, ionizing radiations or contamination by radioactivity from any nuclear fuel or from any nuclear waste from the combustion of nuclear fuel, or, by the radioactive, toxic, explosive or hazardous properties of any explosive nuclear assembly or nuclear component thereof. Loss, damage, or, destruction caused to the insured property by pollution or contamination.

4.)