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Home > Money > Insurance Last Updated: Sep 10th 2022

Understanding Home Insurance in India

Home is the biggest asset each of us own. Important to protect such an asset from risks of damages due to various reasons. Covering how to protect your home, how to cover additional Structures, Valuables, Losses, Natural Disasters, Low Premiums, Flexible Tenure, Before & after you buy a Home Insurance.

What is health insurance?

A home is the biggest asset each of us own. However, there is a risk of physical damage to the home or its contents due to various unavoidable circumstances which could be manmade like theft, burglary, riot, terrorism, fire or natural like flood, storms, cyclone, earthquake and so on. Such risks are covered through home insurance.

Normally, when we think of insurance we think of life, health and motor insurance. Home insurance penetration is very low in India. But it is important to understand home insurance and why you need it. Here are some of the key features of home insurance.

Protect your Home

A comprehensive home insurance policy will not just protect your building from all the perils mentioned above. This includes protection of the physical structure. Even if you are living in an apartment on the tenth floor, it can be covered by home insurance as home insurance only covers a structure and not the cost of land. Damage due to bursting or overflowing of water pipes is also covered.

Cover additional Structures

A home insurance policy also covers additional structures which may not necessarily be attached to your home. This includes garages, fences and sheds.

Cover Valuables

You can also additionally opt for coverage of valuables in your home which includes appliances, furniture, jewellery and so on. Even if you are a tenant, a home insurance can help you cover the valuables inside your home.

Cover your Losses

There are 4 different types of home insurance policies you can opt for.

  1. In case of indemnity basis plans, loss or damage to the property is covered after factoring in wear and tear.
  2. In case of reinstatement value basis plans, a damaged article will be replaced with an identical article.
  3. In new for old basis plans, the replacement cost is paid in full for items that are damaged to such an extent that they cannot be repaired.
  4. Finally, there is the agreed value basis plans where the insurance company settles the loss based on an agreed value at the time the policy was purchased.

Protect yourself from Natural Disasters

Natural disasters like floods, earthquakes, landslides and so on can cause extensive damage to your house and the cost of repairs can turn to be very high and dent your finances. Floods are common in major Indian cities. A home insurance cover protects you from such natural calamities and gives you peace of mind.

Low Premiums

Home insurance premium rates are actually very low if you compare it to the benefits it could offer. You can insure your home and the valuables for as less as a few thousand a year. However, your premiums depend on various factors like the amount of coverage, location, deductibles and security measures.

Also, you can avail discounts if you buy a home insurance policy online and/or along with other insurance plans such as life, health, motor (auto)

Flexible Tenure

Home loan is available for one year as well as for a long-term. The building structure can be insured for up to 30 years while the home content can be insured for up to 5 years.

Before buying Home Insurance

However, before you buy home insurance, you need to do your homework. First, you need to understand your requirements and assess your insurance needs. For additional coverage for items like jewellery, you would need to opt for add-on riders.


The next step is to shop around and look at insurer policies offered by different insurers. Compare the policies based on cover, limits, deductibles and price and arrive at your decision. For this it is important to do online research and also speak to different agents.

A home insurance policy provides peace of mind and secures your home from various risks.

Disclaimer: This article provides an overview and general guidance, not exhaustive for brevity. Please refer Income Tax Act, GST Act, Companies Act and other tax compliance acts, Rules, and Notifications for details.