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Does Home Insurance Cover Earthquake Damage In India

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Loss Assessment For Condo Unit Owners

In Heart of Earthquake Country, Most Homeowners Go Without Quake Insurance

If you are a condo unit owner, your HOA may have insurance for common areas and the exterior structure of the building however, it may not cover earthquake damage to those common areas and exterior structures. Additionally, your association may require you and other unit owners to share repair costs or pay part of their policy deductible through an assessment. CEA condo unit policies provide up to $100,000 for your share fo certain assessments if your association imposes an assessment for covered damage caused by an earthquake.

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Ways To Lower Your Home Insurance Premium Costs:

A comprehensive home insurance cover is very essential to protect your most cherished investment, your home, from unforeseen mishaps. But, with increasing premium costs, it is becoming difficult to fit a home insurance plan to your yearly budget. Here are some tips to lower the premium costs when it comes to insuring your house.

  • One of the easiest ways to reduce your home insurance premium costs is to compare all available home insurance policies before applying for one. Check the policy inclusions, exclusions and features to know which scheme offers the best value for money.
  • Check for discounts offered by your insurer. Many insurance providers in India offer special discounts when you install monitored security devices like smoke detector and burglar alarm.
  • Increasing the deductible amount for home insurance also reduces premium costs. Home insurance deductible is the amount that the insured has to pay when filing a claim.
  • Make sure that you have sufficient amount of coverage but is not covered for very unlikely risks. Also, eliminate all unnecessary add-on covers.
  • Different types of home insurance policies are offered depending on if you are a home owner or a tenant, choose your home insurance plan accordingly.

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How Is Home Insurance Premium Calculated

Your home insurance policy premium is calculated based on some of the below factors

  • Whether the property is owned and occupied by you or is it a let-out property?
  • Whether the property is a Flat or an independent building?
  • Age of the property
  • Are you planning to take a cover for the contents or only the structure of the house or both?
  • Place or location, size and type of construction of the house
  • Do you want to include Jewellary in the insurance cover?
  • Additional covers like below are also offered along with the basic cover. You may have to pay extra premium to include these covers in the standard policy
  • Third-party liability Public Liability cover
  • Loss of rent or Alternate Accommodation
  • Cost of shifting & Temporary Resettlement cover
  • Pet Insurance
  • Accident Cover
  • Burglary cover
  • You can also have a cover for portable equipment such as mobile phones, laptops, tablets etc.,
  • Excess : An excess is the amount you must contribute towards a claim for each event that occurs. If you opt for voluntary excess then insurance company will offer you discounted premiums.
  • Worldwide cover for contents.
  • Factors Affecting Motor Insurance Premiums

    Does Your Homeowners Policy Cover Earthquake Damage ...

    A host of factors influence the premium of package insurance covers. Key factors include:

    • Make and model of the vehicle
    • Age of the vehicle
    • Customer profile
    • City of the customer

    Motorists can choose the suitable coverage required for their vehicle. In case of only a TP cover, the premiums are regulated by the Insurance Regulatory and Development Authority of India .

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    Home Insurance Policy & Sum Assured Options

    Most of the plans offer below Sum Assured options for Building Structure

    • Sum Assured On Agreed Basis : This is mainly applicable for Flats/Apartments. The Sum Insured for Flat on Agreed Value Basis is arrived at by multiplying the Total Sq Feet area of the Flat by the value per square feet.
    • Sum Assured on Reinstatement Value Basis : This is also known as cost of re-construction basis. Sum Assured is arrived at by multiplying area of the flat/house by cost of construction on present day basis. The cost of construction may not remain same every year, so some home insurance plans offer escalation clause.
    • Sum Assured on Indemnity Value Basis : In this method, depreciation value is deducted from the Reinstatement value .

    Most of the plans offer below Sum Assured options for Household Contents

    • New for Old Basis : The Sum insured for Contents shall represent the Replacement Value of the insured items by a new item of the same kind and same capacity. The natural wear and tear or depreciation is not taken into consideration.
    • Indemnity Basis : The replacement value of the insured contents is calculated as new item cost minus allowance for wear & tear or depreciation.
    • As far as Gold, jewellary, diamond & other valuablesare concerned, the maximum sum assured limit and other terms & conditions vary from one plan to other plan.

    Does Homeowners Insurance Cover Wildfires

    Wildfires are a regular concern for homeowners in certain areas. While home insurance policies tend to cover wildfire damage nationwide, in places like California companies can make some tweaks to their policies due to the high probability of such peril.

    This could mean raising overall rates or adding wildfire coverage as a rider instead of it being included in the standard policy. It could also lead to a very slow payout if there is high claim volume. You can get dedicated fire insurance or look for a company that has robust resources to deal with this specific issue.

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    Home Insurance Policy: Eligibility Criteria

    You can purchase the HDFC ERGO Home Insurance Policy if you are:

    The owner of an apartment or an independent building can insure the structure and/or its contents, jewellery, valuables and portable electronic equipment.

    The owner of a flat or apartment can insure the structure of their property as per carpet area and cost of reconstruction.

    A tenant or a non-owner, in which case you can insure the contents of the house, jewellery and valuables, curios, paintings, work of art and portable electronic equipment

    What Is The Difference Between Home Insurance & Home Loan Insurance

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    You buy Home Insurance to cover the replacement cost of your home should it be damaged by fire or other accidents. Home insurance also covers the replacement cost of your belongings should they be damaged or stolen.

    Home Loan Protection Plan, on the other hand, is simply to guard against the risk of default on home loan in the event of death of the borrower. The purpose of home insurance is to protect the homeowner. The purpose of mortgage insurance is to protect lenders .

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    What Does Homeowners Insurance Cover Here’s How A Standard Policy Works

    Thomas Barwick/Getty

    Homeowners insurance covers damage related to weather and some catastrophic events.

    • Homeowners insurance covers two main types of loss: damage to property and belongings and liability for personal injury.
    • Most standard policies also cover loss of use, meaning the insurance company will pay for the homeowner to stay elsewhere while the home is being repaired.
    • Basic homeowners insurance covers financial loss caused by weather and catastrophic events .
    • Most homeowners policies do not, however, protect against flooding, earthquakes, neglect, power failure, war, or intentional loss.
    • Read more personal finance coverage.

    A home is a huge financial asset, so it’s always a good idea to have protection.

    When you take out a mortgage to buy a home, you’ll likely be required by the lender to have homeowners insurance to protect the home itself and everything inside it.

    Generally, homeowners insurance covers two main types of loss: damage to property and belongings and liability for personal injury that involves the homeowner or their family members.

    Cars In The Parking Area Are At Risk

    Even if your automobile is sitting in a parking lot, it might be damaged if another vehicle collides with your back bumper. You may, however, exhale a sigh of relief if you have comprehensive auto insurance. A comprehensive automotive insurance policy can also cover damage to a vehicle caused by an earthquake or other natural disaster.

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    Understand How Your Deductible Impacts Your Claim

    A deductible applies every time you file a claim and only to property damage , not personal liability coverage. The deductible is subtracted or deducted from your claim payout.

    Your deductible can be a dollar amount or a percentage. The Insurance Information Institute noted that the standard homeowners deductible is typically between $500 to $1,000. The declarations page of your insurance policy will state your deductible amount and whether it is a percentage or dollar amount.

    Car Insurance That Covers Everything

    Do Home Insurance Cover Earthquakes
    • It protects the insured vehicle, as well as the owner and driver.
    • In-transit damages, natural calamities, theft, and man-made disasters are all covered by the insurance policy.
    • It includes third-party liability coverage.
    • This plan’s coverage can be enhanced by purchasing add-on auto insurance coverage.

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    Home Insurance Is Something You Should Get To Protect Yourself Against Natural Calamities Here Are 7 Things You Should Know About Home Insurance

    • Take cover
    • Buy structure cover only if needed
    • Go with the detailed plan for contents
    • Go for replacement costs for contents
    • Take precautions after insuring
    • Protect your documents
    • Follow correct steps for claims

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    Do You Have To Pay If The Fire Department Comes Ontario

    Most fire departments do not charge you to respond to an emergency. Fire Departments are usually funded by tax revenue. There are exceptions to this, such as fire department ambulance transport, and private Fire Departments, that do charge.

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    Emergency Kit And Grab

    If your house, apartment or condominium is not damaged after an earthquake, the best thing you can do is stay home and use your emergency kit. This will help first responders do their job and ensure emergency reception centres are available to those who need them most.

    To build your emergency kit, collect enough non-perishable food, water and emergency supplies to support your household for a minimum of 3 days. It’s a good idea to have one to 2 weeks of supplies. Make sure everything is stored together in an accessible location.

    In case you have to leave your home, you should also prepare grab-and-go bags for each family member, including pets. These are smaller versions of your emergency kit. Make sure the bags are easy to get to and that everyone knows where they are.

    Whats Not Covered In Package Motor Insurance

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    Certain events and incidents may not be covered even if you have a package motor policy. One such example is if your vehicle endures damage due to a collision, then a car insurance claim cannot be made. A few other situations that are not covered under the package insurance cover include:

    • Electrical or mechanical breakdown: Generally, under the standard motor policy, a mechanical and electrical breakdown is not covered unless the insured can prove that damage was caused due to flooding.
    • Driving without a license: In case you are found driving the car without any valid driving license, then the damages and/or losses incurred will not be covered.
    • Drunk driving: A package policy does not cover any losses or damages incurred if you are caught driving the car under the influence of alcohol.
    • Damage to tyres: It does not cover any loss or damages to the tyres of your vehicle unless it is a direct result of a car accident.
    • Loss caused due to nuclear weapon/war: It does not cover any loss or damage caused to your vehicle as a result of war, mutiny, nuclear weapon or other such dangers.

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    Does Homeowners Insurance Cover Earthquakes

    Earthquakes are not a covered event under homeowners insurance and require a separate policy. For California homeowners, earthquake insurance is available from the California Earthquake Authority .

    Homeowners will need separate earthquake insurance. Homeowners insurance covers your property from damage, referred to as insurance perils. A peril is an event that may damage your home or belongings.

    Most homeowners insurance covers named perils, which are events that are specifically listed in your insurance policy. Common insurance perils include fire, lightning, theft, ice, snow, sleet, wind, hail, smoke, vandalism, and freezing.

    Earthquakes, floods, government seizures, mudslides, ordinance updates, sewer backups and sinkholes are all perils that will not be covered by homeowners insurance, according to Hippo Insurance. Those will require an add-on rider or separate coverage.


    *Available as add-on coverage if not part of policy

    **Flood insurance is available through the NFIP and approved insurers

    ***If you live in hurricane or tornado areas, additional windstorm rider may be required

    Why Is It Important To Insure Your Home

    Here are the main reasons why you should consider purchasing a home insurance policy.

    • A home insurance policy protects you against bodily injuries and property damages caused to other people for which you may be legally sued by other people. Insurance also covers injuries caused to yourself or your family members.
    • Home insurance covers you against natural and man-made disasters like earthquakes, floods, cyclones, etc. the effects of which may be devasting on your finances and totally leave you bankrupt.
    • Home insurance will provide you accommodation and living expenses in case your home is permanently destroyed or you have to live somewhere else due to major repairs.
    • Your house is made into a home by you after investing in household articles, and appliances over the years. Insurance will cover the value of these articles inside your house.
    • One of the most important advantages is that it will make it easier for you to purchase a home loan from a bank, or use your house as collateral for other transactions.

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    Eligibility For Home Insurance:

    There are certain criteria that you must fulfil in order to obtain a home insurance. This varies widely from company to company. However, most companies have minimal requirements when it comes to home insurance. They are:

    • Home Insurance Policy can be bought by individuals or by companies. Individuals who are Indian residents and the owner / occupant of a property can get a Home Insurance Policy. Home Insurance – multi year policy, however, can be purchased only by the owner of the house/flat.
    • To buy Home insurance for a society, any authorized member of the particular societys managing committee can make the purchase. The policy will be issued in the name of the society and will cover the society building as well as the utilities that are for common use in the society.
    • Its not just owners who can get home insurance. Many insurance companies provide cover for contents to tenants as well. Contents insurance will cover your possessions against loss or damage by lightning, fire, theft, smoke, flood etc. Everything from personal belongings, furniture and electrical items including washing machines, dryers etc. can be covered. You must read the fine print carefully before buying cover as a tenant. What is covered will vary from company to company. For example, certain insurers will not cover contents if you live in a shared accommodation. There are many such exceptions that you must look out for.

    How To File A Claim For Home Insurance

    Does my property insurance cover damage caused by an ...

    The first step is to notify the insurance company as soon as possible by phone or email, that a claimable event has occurred. This is just a preliminary intimation and detailed documents and proof can be submitted within the next 2 weeks. The next step is to inform the police, in case of a fire, theft or burglary as the insurance company requires diligence on your part to take initiative to apprehend the guilty person. Thereafter you must submit all invoices, photos, documents, and proof to the insurer, who will thereafter send surveyors to investigate the damage.

    Documents required for Fire Insurance Claim

    • Duly filled in Claim Form
    • FIR copy
    • News Paper clippings
    • Title Deeds and Layout plans
    • Relevant bills and invoices

    Documents required for Alternate Accommodation

    • Duly filled in Claim Form
    • Proof of rent paid for such alternate accommodation in case of reimbursement claim
    • Proof of actual occupancy at the accommodation

    Flood Insurance Claims

    • Duly filled in Claim Form
    • Meteorological Dept. report
    • Title Deeds and Layout Plan
    • Estimates of repair from an Engineer
    • Bills of repair

    Theft and Burglary Insurance Claim

    • Duly filled in Claim Form
    • FIR copy detailing items stolen and subsequently Final Police Report
    • Original Invoices of items
    • Newspaper Clippings

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    Listing Insurance Companies To Become Mandatory

    IRDAI, the insurance regulator, will be releasing an exposure draft soon in an effort to make it compulsory for insurance companies to be listed. A discussion paper on the issue has already been released. The purpose of this paper was to emphasize the need for listing firms, and that listed companies will have stricter norms regarding disclosure. Presently, only ICICI Prudential Life Insurance has plans for listing the company. There will be more transparency in the insurance system when companies are listed. In terms of the number of insurance policies sold in 2015-16 and the premium income, the life insurance sector showed growth in double digits. These numbers have not been seen since 5 years. The high growth is mainly a result of the amendment to the Gratuity Act making the amount payable Rs.10 lakhs from Rs.3 lakhs. The gratuities are payable by the insurance companies resulting in higher funding. A number of banks have partnered with insurance firms as the IRDAI recently introduced new bancassurance norms allowing banks to sell only 9 policies which is 3 in each category of life, non-life and health insurance.

    1 September 2016

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