How home insurance can shield you from costly monsoon damages

Monsoon-related property damage is a concern that many homeowners worry about. A comprehensive home insurance policy can help protect not only your house but also everything inside it from damage caused by heavy rains and storms during the monsoon season.

Most standard home insurance plans cover damage caused by heavy rainfall, such as flooding or water entering your home. If this happens, your policy can help cover the costs of repairs to your home and the replacement or repair of your damaged belongings.

“You can also choose to insure everything inside your home, like electronics, furniture, clothes, and jewellery, under the same policy. Since these things often cost a lot and are just as important as your house itself, it makes sense to include them. To do this, you should clearly tell your insurer when you buy or renew your policy that you want to cover both your home and its contents. You’ll need to list out your valuable items at your end and their estimated value, so your policy can protect them too adequately,” said Gurdeep Singh Batra, Head-Property UW (E&S), Risk Engg, Global Accounts and Coinsurance, Bajaj Allianz General Insurance.

In addition to the events mentioned earlier, your home insurance policy also covers damages caused by perils like fire, lightning, earthquakes, storms, riots, strikes, and damage caused by malicious acts. It can also protect you from impact damage,  tank bursts, or objects falling from above, as per coverage under policy. If theft occurs within seven days of an insured event, that’s covered too. Basically, home insurance is designed to protect you financially against almost any risk that could damage your home.

“It’s also important to make sure you choose the right amount of coverage, so you will have enough money to recover from any loss. There are three main ways to insure your home: Reinstatement Value, Market Value, and Indemnity Value,” added Batra.

Reinstatement Value means the insurer will pay the full cost to rebuild or restore your home to how it was before the damage, without reducing the payout for age or wear and tear. If you’ve insured your home for the right amount, this makes sure you’ll have enough to rebuild with today’s construction costs.

Market Value or Agreed Value takes into account what your home would sell for today, considering its age and condition. For special things like artwork or jewellery, you can set an agreed value with your insurer based on expert advice. This ensures you get fair compensation, even for items that are hard to replace.

Indemnity Value means the payout is based on the current cost to rebuild, but with a deduction for the age and condition of your property. This usually results in a lower payout unless your policy includes extra clauses to account for rising costs.

In summary, the right home insurance helps you avoid major financial setbacks if something unexpected happens to your home. When you know your coverage and have chosen the right policy, you’re in a stronger position to repair, replace, and move forward quickly after any damage or loss.