Why should a home insurance be a tenants utmost priority?
Home insurance in India is an important financial instrument that protects your abode from financial losses caused by thefts, accidents, and damages caused by natural disasters, etc. Tenants generally overlook home insurance in India, although recently there has been a rise in its demand among tenants too. This is usually due to the assumption that the landlord’s home insurance policy will cover everything, including the portion rented by the tenant. Tenants insurance is also ignored because the tenants generally feel that they do not own the property and, hence, the expenditure is not justified. But the truth is that tenants are equally vulnerable to the risks that homeowners are subjected to, so home insurance is vital even for tenants.
Why is home insurance a must for tenants?
In case you are a tenant, it is important for you to know that even if your landlord has home insurance in India, its protection will not extend to your personal belongings like furniture, etc. Furthermore, you will also be liable for any damage caused to the property you are renting. For example, if you accidentally cause a fire, you will be responsible for the damages. Home insurance in India can provide coverage for such losses.
Home insurance for tenants, or tenants’ insurance, covers two areas:
- Liability coverage: It provides protection to tenants in case for some non-deliberate reason, the tenant or their guest causes damages the building. It can also protect you in situations where somebody gets injured in your rental space and sues you for compensation.
- Content coverage: It provides coverage in case any good is lost or damaged and needs to be repaired or replaced. This is a great way to protect your valuables in case they incur total loss or significant damage because of a natural disaster, or any other cause outlined in the insurance policy.
Benefits of tenant’s insurance
Given below are some of major benefits of investing in a tenant insurance policy –
- Protects personal belongings: Home insurance in India for tenants provides protection for personal belongings, whether they are damaged or stolen. Depending on the policy the coverage may extend to repair or replacement of the item.
- Liability protection: As a tenant, you may be held liable for any damages you cause to the property you are renting. In such cases, tenant insurance can protect you from financial hardship.
- Protection against natural calamities: Natural disasters like floods, cyclones, etc. can seriously damage your rented abode and your personal belongings. This will eventually require significant financial expenditures. A tenant’s insurance can protect you from such a financial burden.
- Temporary accommodation expenses: In case you have to temporarily move out of your rented house, say for extensive repairs, etc., the expenditure of alternative accommodation will be taken care of by your tenants’ insurance.
Factors to consider when buying tenant insurance
Before buying home insurance in India as a tenant, the following are the factors that you should seriously consider:
- The extent of coverage: It is important to know the extent of the coverage of the policy. The policy should cover not only the physical structure but also your personal belongings, like furniture.
- Extent of protection against liability: This coverage provides protection in case someone suffers any injury in your rented home or if you, by accident, cause any damage to the property.
- Amount of coverage for replacement costs: This is important for you to know the extent to which the insurance company will pay to replace your personal belongings or property in case it is damaged or destroyed.
- Theft coverage: You should check to what extent is protection available in case of theft. The policy should offer you a reasonable degree of protection in case of theft.
- Whether additional living expenses will be covered or not: This coverage pays for expenditures in circumstances where you have to temporarily move out of the house in case any substantive repairs are needed by the house.
- The deductibles: Deductibles are essentially the amount that you will be paying out of pocket before the tenant’s insurance policy kicks in. Before finalising on the tenant insurance policy do not forget to check the deductible amount.
- Extent of discounts available: Several insurance providers offer discounts in different circumstances, like in case you have good security features installed in your home. Make sure you are aware of these so that you can avail the best home insurance in India at the lowest possible cost.
Procedure of procuring home insurance for tenants
The procedure for procuring tenants insurance is similar to the purchase of normal home insurance in India and includes the following steps:
- The first step involves valuation. For this, a certified auditor will conduct a structural audit of your rented home and your belongings.
- The next step involves evaluating various policies, considering their features and benefits and the amount of premium to be paid, and then selecting the best tenants insurance plan that meets your requirements.
- After selecting your desired policy provider, choose your required term for the policy, any relevant add-ons if needed, and the sum to be insured.
Hence, the process of selecting a tenants insurance policy is the same as that of any other home insurance policy.
Home insurance in India is an important instrument of financial protection for home owners. But even tenants need to consider purchasing home insurance, also called tenants insurance. This is to ensure that they protect themselves from any unforeseen circumstances that may damage the property they have rented. It also helps in protecting the tenants personal belongings.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.