Isn’t it often said that home is where the heart is. And imagine how heart broken you’d be to see your home damaged due to unforeseen circumstances. In such cases, a robust home insurance policy can help you compensate for the financial losses incurred due to damage to your home and its contents.
There are, however, certain misconceptions associated with home insurance. In this article, we look to debunk some common myths concerning home insurance policies.
Home insurance does not cover natural calamities
Many people believe that home insurance does not provide coverage for natural calamities or ‘acts of God.’ In reality, most such policies do cover a wide range of natural disasters such as floods, hurricanes, tornadoes, wildfires, and hail storms.
Earthquakes are one exception to the list of natural calamities covered by home insurance. However, you can always purchase an add-on for this disaster.
Home insurance is only for those people who live in disaster prone areas
While it is true that those living in disaster-prone areas require home insurance, it is erroneous to believe that home insurance is not needed for others.
What if a burglar breaks into your home and steals your valuable possessions? Or some electrical hazard causes a fire in your home?
Will not a home insurance policy offset the financial trouble of rebuilding your home from scratch?
Tenants do not need home insurance
This is one of the biggest myths around the purchase of home insurance. Remember that even if you do not own a house and you live in a rented one, you can always avail home insurance to protect the contents of your house.
Once you change your residence, you can update your new address with the insurer and continue to avail the coverage for the contents of your new residence.
Home insurance provides a coverage only for the structure and the contents of the home
One of the most common myths around home insurance is that it provides compensation only for the structure and the commodities of your house. However, there are a wide range of add-on facilities that can boost your existing home insurance and that go beyond protecting your home and its contents..
For instance, if you have to move out of your premises for a specific duration due to a calamity or an insured peril, a home insurance add-on policy will indemnify you against the expenses for an alternate accommodation until your premises is inhabitable.
You must pick a low coverage home insurance that have low premiums to save costs
There is no denying that a low coverage will entail a low premium. However, purchasing home insurance only to lower costs defeats the very purpose of insurance because a low coverage amount might not cover you for all your needs.
Rather, you must analyze your requirements carefully and buy a policy that will cover you for most, if not all, of your risks.
Low premium means low coverage
Low premiums might not equate to low coverage as there are ways in which the premiums can be brought down. For instance, if you have taken safety precautions for your home, such as installing a fire alarm or a CCTV camera, the insurer will be inclined to reduce your premium.
Similarly, letting go of unwanted add-ons to your policy can reduce premiums by a significant margin. For instance, if you do not keep much of your jewelry at home, it would be prudent to omit a jewelry cover add-on from your policy.
Applying for claims is cumbersome
The insurance sector has not been left untouched by the digital revolution that has taken the world by a storm. Gone are the days when the claims settlement procedures were intimidating and cumbersome. Rather, nowadays, claims settlement processes are extremely simple and all you are required to do is fill in forms and submit the documents online.
Premium amounts increase each time you file a claim
While premiums do not increase if you file a single claim, multiple claims in a year might result in increased premiums. Thus, it would be a good idea to not file a claim unless the reimbursement amount is high.
Purchasing home insurance could be a tricky process. But, now that we have debunked some common myths associated with home insurance, we hope you will find it easier to make an informed decision about purchasing one.