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Think it over : Insure your building and its contents from fire and allied perils and relax.

In a few instances, the worth of walls and beams would even fade out when juxtaposed with what they hold, say an M.F. Hussain. It is in this context that a Householder’s Insurance Policy assumes significance.

“To protect a house along with its contents against all perils, a composite policy would be ideal. Apart from fire, burglary, and theft which are common to all, the policy provides cover against specific risks associated with select items,” says Ganpath Kulkarni, Development Officer of the New India Assurance Company Limited.

To elaborate on this, for example, jewellery and other accessories need coverage even when they are worn outside the house.

Electrical and electronic appliances have a specific risk of breakdown due to short circuit or power fluctuations.

A composite policy of New India, apart from covering a building and its contents from fire and allied perils, burglary, and house breaking including larceny or theft, will provide insurance to at least one select item against specific risks.

“A composite policy is always advisable because it carries some amount of discount in terms of premium. Individual policies for each precious thing will carry high rates of premium,” says Mr. Kulkarni.

Though such a policy covers whole house along with its contents, each item being insured should be listed out along with the value it is being insured for.

This is to avoid complications in case of partial loss of property. The itemised listing may include clothing subdivided into cotton and silk; furniture that includes mattresses and pillows; gas stove, utensils, crockery and cutlery, steel/wooden almirahs, carpets, decoratives and antiques, sewing machine; electronic appliances such as washing machine, refrigerator, air cooler, fans, music system, geyser, wet grinder, mixie, record players, domestic pump set upto a capacity of 0.5 HP, electric iron, air conditioner and books.

Even the jewellery needs to be listed with specific details of each item. The section also includes other valuables such as watches and cameras. Other items which find place in this kind of policy are fixed plate glass used for windows and partitions, pedal cycle, personal baggage, personal accidents and public liability with specific coverage of workmen’s compensation liability.

Premium varies from 0.65 paise upto Rs.20 (for a pedal cycle) for every insured value of Rs.1,000.

After the listing comes the question of valuation. Devil always tempts and hence one tends to inflate the value of one’s property on paper. Doing so will backfire, warns Mr. Kulkarni. First, you will end up paying higher premium. Second, though quite lenient with regard to paper work, the insurance company will tighten its fists when loss occurs, as it is well aware of the ways of devil. At the time of payment, the value of each item will be appraised carefully according to the prevailing market rates.

“It is either reimbursement or replacement, whichever is less. For example, if a television set is valued at Rs.15,000 against the current market price of Rs.10,000, then the loss will be recompensed with a new set.

However, if the current market price exceeds the insured amount, the claimant will get only the latter,” says Mr. Kulkarni. Hence, it pays to be honest by quoting the correct value.

All said and done, one can not play fiddle while the house is burning even if it is insured. They have to produce evidence of adequate measures towards protecting the property such as calling the fire brigade and complaining to the police. The insurance company too has to be notified about the loss soon after the incident.

United India Insurance, Oriental Insurance and National Insurance Company are a few other agencies that provide insurance for household property.

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