Importance of a Home Insurance Policy in India

Buying/ building a home is one of the largest and riskiest investment for most people. Therefore, for the most important investment in one’s life, there has to be some cautious planning to protect and preserve it. Considering these proactive measures have been adopted by the insurance companies to provide Home Insurance Policy.
While most of us feel that it is a waste of money as it is an investment for an uncertain cause. In spite of that, it is a good idea to take up a little expense to avoid a huge financial setback in the future.
Owning a house is undoubtedly the costliest asset and the most treasured for. Any catastrophic devastation caused due to earthquakes and other natural calamities can shake the entire structure of the house. The consequence of the same is likely to be that the house becomes completely unlivable. It is only to protect the house from such unforeseen circumstances that house insurance becomes crucial, for house owners and tenants alike. In case the house gets damaged, the emotional and financial pain of rebuilding a house or reinstalling its contents is painful, difficult and tedious. A comprehensive home insurance policy spares an individual from the horror of the same.
The primary reasons for having a home insurance policy have been listed below:
1. Protection against liabilities
(a) It provides liability coverage which protects a person against personal injuries, property damage the guests and other third parties which they might have incurred while residing in the insured house.
(b) There could also be loss and damage caused to third parties for which a person residing in the insured house might be legally responsible. This coverage protects from that loss too.

2. Provides Coverage against natural and man-made calamities
(a) A comprehensive home insurance policy covers your house against losses and damages caused due to natural calamities, such as earthquakes, floods, lightning, storms, typhoons, etc.
(b) The policy also covers your house from man-made hazards and anti-social activities, alike. These are acts such as vandalism, thefts, strikes, riots, other activities caused out of malicious intent, etc.

3. Cost of Temporary Living expenses
(a) If an insured house has undergone some damage and has become uninhabitable, therefore during the renovation process if an individual takes out a house to stay on Rent, then the insurance company will cover the expenses incurred for paying rent in the insurance policy and will reimburse them until the house gets back to a liveable condition.

4. Coverage for the loss of Valuable assets and personal belongings
 Apart from covering the structure of your house, house insurance companies also offer policies to provide coverage against loss/ damage of articles/contents kept inside the insured house. These include various valuable, expensive, and important belongings. These include documents, personal belongings including jewelry, clothing, appliances, furniture, and much more.

5. Easier to avail home loan from banks
Some banks give preference to those customers (for sanctioning a home loan to them) who have the home insured. For certain financiers, home insurance is, in fact, one of the major eligibility criteria for availing a home loan.

6. Emotional Satisfaction
In case the house gets damaged, the emotional and financial pain of rebuilding a house or reinstalling its contents is painful, difficult and tedious. Getting a home insured provides an individual with ultimate peace of mind. Once a policy has been selected for the home insurance, protecting the property is no longer the responsibility of the owner.

7. Low Premium
Though a home insurance policy might seem like an unwanted expense, the benefits provided by the scheme are much more than money can buy. For example an insured amount of about Rs 40 lakh of the building, one can get a home insurance policy worth just Rs 2,000 per year as premium. Additionally, the most comprehensive policy, which covers even the contents of the house, can be bought at an approximate value of just Rs 5,000 per year.