Advantages and Limitations

Advantages

You can have complete peace of mind regarding your property investment. When you are away on holiday/tour, you worry less about your home and its safety. For a nominal premium (approximately 0.50 paise per Rs 1,000), it is the cheapest of the premiums in an insurance policy. Some insurers offer discount on premium (even up to 50 per cent) if one takes a long-term policy. All unintentional damage to structures/assets is adequately compensated, with repairs/reimbursement of rent paid on lease (up to one year), thereby minimizing the hassles and documentation.

Limitations

Perils covered are not uniform. The consumer is not able to take an informed decision quickly while comparing the home insurance products on offer. Sum insured and premium cannot be clearly defined as these are based on risk assessment of building (value, age and class of construction), material assets and additional insurance covers. Individual ceiling on compensation on each item damaged thwarts full compensation of costly items. Structural damage due to earthquake (fire and shock) is covered in some policies but seldom settled in a home insurance claim.