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Insurance Article

Three Key Aspects Your Home Insurance Policy Might Be Missing

February 03 2017
Three key aspects your home insurance

Three important things, which your home insurance policy might not have

Home Insurance is a necessary safeguarding investment, which protects you from shelling out extra money from your pocket, in case you suffer an unfortunate loss to your house. Buying a comprehensive Home Insurance policy is smart, but is it smart enough to end the process there and not see if it has all you may need? Here are 3 things that would be wise to take note of while buying home insurance.

Building Ordinance Coverage

What if your home gets burned down in a fire and you have a Home Insurance policy, but it can’t provide enough cover because building laws have changed?

A Building Ordinance Coverage is the cover that provides for increased expenditure in repairing a damaged building, due to changes in the building construction laws of the country. It safeguards the policyholder against incurring any unanticipated additional costs in rebuilding their home on account of newly effective laws.

Building ordinance coverage is typically not included in a basic home insurance policy. Therefore, you must additionally purchase this cover in your home insurance policy by paying an extra premium. These covers too might not provide for the entire extent of added expenses but only a limited amount, say 10% or 25%. The higher the premium, the higher will be the coverage.

Alternative Accommodation Cover

Although alternative accommodation expenses are covered in all home insurance policies, the cover you are currently entitled to might not suffice if you are forced to live in another rented place for an extended period.

In case of a loss or damage to your house, your home insurance policy will provide for the unavoidable additional expenses on rent you’ll have to bear when you stay at some other place, until your home is rebuilt. However, there are limits in terms of amount or time to this. This is where you need to take a closer look at your policy. Check to see if you can extend the time to avail the alternative accommodation cover, or adopt a no-time limit policy if you have an opulent house insured, which might require extensive time to be reconstructed if damaged.

Coverage Against Allied Perils

Home Insurance policies do provide cover against fire and allied perils, like storm, cyclone, flood, riot or strike, lightning, etc. Allied perils are more ambiguous in the policy wordings and will usually provide more coverage in a covered claim scenario. This means that the policyholder shall be entitled to additional coverage for reasons not specifically excluded in the policy document. So, if your home suffers loss or damage for any natural or man-made cause not specifically mentioned in not covered list, you will avail the cover benefit. Taking a policy with cover for fire and allied perils may impose a higher premium but will save you from further financial loss in the event of any severe damage to your home due to any cause.

Therefore, while considering a Home Insurance policy, you must opt for quality. Take a closer look at your policy and invest time in discussing with your agent or insurer the extent of coverage it offers at the time of any mishap.

Related Article:

What Do You Look for When You Compare Home Insurance Policies?
Burglary Insurance and First Loss Policy Explained

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