Why an annual review of your home insurance policy is important?

Your home protects you from external elements and the harshness of the world. So, shouldn’t you care about it too? Getting the best home insurance in India can do the trick, as it will give you financial security and the advantage of replacing your expensive insured belongings if they get damaged in an unforeseen event. Remember that a natural calamity may strike any time and a manmade hazard or fire can cause immense damage to the structure and contents of your property. Such events can cause huge financial losses if you do not have home insurance. Also, if you have a home insurance plan but it isn’t adequate, you may have to shell out a large sum of money from your savings. Hence, it is important to choose a suitable coverage amount and review your home insurance policy every year to see if it needs to be updated.

Reasons to review your home insurance policy

If you are wondering why you should review your home insurance policy every year, here are some reasons:

1. Property value must have increased:

   The market value of a home typically increases every few years. For instance, say you bought a house for INR 50 lakhs and took a home insurance coverage accordingly. However, after a few years, the value of your house increased to INR 75 lakhs, but you did not update your home insurance coverage. Now, in case your house gets damaged due to a natural calamity or fire, you will be forced to pay the difference when re-constructing it.

    

2. New furniture, electronics and other personal items:

   When you take home insurance, you also calculate the value and cost of replacing expensive items around the house. Over the year, you must have bought new and more expensive things or replaced old and broken furniture with higher value ones. In such cases, you should upgrade your home insurance coverage to cover the new belongings. Also, if you have purchased expensive jewellery or electronics in the past few years, check if your existing home insurance coverage is adequate to replace them in case of an unexpected event.

    

3. Home renovation:

   Suppose you decide to renovate a part of your house, such as the kitchen or basement. This will increase the overall value of your property by a few lakhs. Hence, you must also update your home insurance coverage accordingly so that it covers the replacement costs in case you need to file a claim in the future.

    

4. Renting out your home:

   If you plan to rent out your home, review your existing home insurance coverage. You must also talk to the insurer and find out if the plan will cover the damages your property suffers during the rental period.

    

5. Check if new discounts are available:

   Most insurance companies change their discount offers often. Hence, you must review your home insurance policy from time to time and talk to the insurer to know about new discounts offers. Often, insurers offer discounts on premiums as well. So, remember to check annually if you qualify for any new discount on your home insurance plan.

Things to keep in mind when reviewing your home insurance policy

Even if you have purchased the best home insurance in India, keep the following things in mind while reviewing it:

• Assess future risks, especially if you stay in a region prone to floods, cyclones, earthquakes and other natural disasters.
• Check if your home insurance coverage is adequate to cover the increased value of your property and new purchases.
• Check if portable electronics are covered. Also, add new and expensive electronics to your existing plan.
• See if you want to improve the protection of your property and its contents with important add-on covers.

Conclusion

Though home insurance is overlooked by many in India, it is one of the most important insurance policies for homeowners. The plan secures the structure and valuable contents of your house against damages caused by natural calamities and manmade hazards, thereby saving you from financial woes. Moreover, since the value of your home and its contents can change over the years, remember to review your home insurance plan at least once a year and make necessary changes to it for better coverage. Lastly, to buy the best home insurance in India, research online, compare different insurers, go through customer reviews and then make a choice as per your specific need.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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