Home insurance is the best option for home protection. It provides financial security from many accidents like natural disaster and fire. But there are some things which are generally not covered in home insurance. In such a situation, you should look at the terms and conditions carefully while getting the house insured. This will prevent you from incurring any loss.
Everyone dreams of having their own home. To fulfill this dream, people put all their savings at stake. They also take home loans. In such a situation, everyone wants to protect their dream home. For this, home insurance is very important, which comes in handy in case of any accident.
But, while taking a home loan, you should pay special attention to which things are covered in the insurance and which things are not.
Who does home insurance?
General insurance companies insure your home. Many things are covered in it. Such as compensation for damage to the house due to flood, storm or fire. But, while getting the house insured, the terms and conditions should be looked at carefully. It is clearly written in it that in which cases you will get coverage and in which you will not.
Commercial use of the house
If you insure your house and then give it for commercial use, it will become a commercial property. In this case, your home insurance policy will not cover that property. If you are planning to rent out the house for commercial use, then there is no point in insuring it.
Demolition order
If any government authority orders demolition of the house, then also home insurance will not be of any use to you. The government often orders demolition of illegal construction. To avoid this, you should check the documents carefully before buying or building a house.
Loss due to poor construction
If any kind of loss occurs due to defects in construction, then also the insurance company can reject the claim. In such a situation, while building the house, you should ensure that all the materials are of good quality. If the contractor is using a poor quality product, then he should also be refused.
Home insurance premium
The premium of home insurance is decided on the price of the house, location and other factors. Generally, the premium of home insurance can be from 0.5 percent to 2 percent annually according to the price of the house. However, before taking home insurance, one should consult a financial advisor.
