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How to face household risks
The householder’s insurance policy has been designed to cover various risks and contingencies under a single head. This policy provides cover against fire, burglary, theft and robbery. Jewels and valuables are covered even if they are worn by the insured and his relatives. Accidental breakdown of electrical and electronic gadgets are also covered.
If you opt for this policy, take care while choosing an insurer or intermediary. There is a base rate for the premium to be collected for each risk or contingency covered. The premium for fire policy for a building (sum insured can represent the market value, where depreciation will apply or on reinstatement value where depreciation will not apply) is 50 paise per Rs. 1,000 and includes damages caused by fire, explosion, riots, strikes, malicious damage, flood and earthquake (terrorism is optional and the rate is 10 paise per Rs. 1,000).
Need to bargain
If your building is worth Rs. 10 lakh, your yearly premium would be Rs. 600. Though there is a base rate, insurance companies can charge premium based on the risk perception as all the sections in the policy have been withdrawn from tariff regulations with effective from January 1, 2007. You need to bargain with the insurers or intermediaries to get the best deal. In case of eventualities, some companies settle the claims in a fortnight’s time and some beyond that. Hence, the premium as well as the service provided by the insurer becomes important while opting for a policy.
“Even though the policy offers comprehensive cover, there are some general exclusions and exclusions pertaining to each section of the policy. Hence, the insured should read and understand the cover in terms of the policy so that there are no surprises in the event of a claim,” says S. Ravishankar of Risk Track, an insurance consultancy firm.
The exclusion under burglary mentions “loss or damage by burglary and/or house breaking where any member of the insured’s family is the principal or accessory.” Hence, read even the fineprint carefully.
What to do in case of an eventuality? You need to intimate the insurer first. The company will send an independent surveyor to assess the damage and file a report. He/she will also collect the claim form, in which you need to provide name, address, policy number and the details of the accident such as the cause, the time etc.
A.B. SUDHINDRA
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