Is It Mandatory To Buy A Home Insurance Policy When Buying A New House?

The 21st century has been marked with constant mass migration. People moving to cities from rural and semi-rural areas has been consistent. Reasons include the setting up of new industries which creates job opportunities, expansion of cities leading to more housing, and introduction of better facilities, among others. As more and more high-rises come up to accommodate the rising population, the demand drives up the price houses. If you are looking to purchase a new house for yourself and your family, you will be investing a huge sum. Considering the magnitude of this investment, it would make sense to safeguard it with a home insurance policy. But is the policy mandatory at the time purchase? Let’s understand this in detail.

Home Insurance: Mandatory Or Not?

Before we understand if the policy is mandatory or not, let us first look at the home insurance benefits:

1.    Secures your valuables

When you purchase a home, you will fill it up with things which would match your imagination - furniture, electronic appliances, and other accessories that would make the home complete for you. In addition to these items, your personal items would also be included. Jewellery and paintings are some of the personalised items that you would store in your house. Considering their value and importance, any harm would mean a significant loss for you. This could be due to different reasons. Instead of having to face such a loss, you can safeguard these valuables with the coverage offered under home insurance.*

2.    Protection against natural calamities

If you are living in an area which is prone to flooding, chances are that such a natural calamity can damage your house. Water entering the house is known to cause considerable damage to the house. Another severe calamity that can cause considerable damage to your house is an earthquake. Their devastating effect can completely bring down structures, which could lead to a total loss of your house. Other calamities such as cyclones and hurricanes also cause major damage to structures. The insurance policy for a home provides all-round coverage from any damage that a natural calamity might cause. You would be compensated depending on the damage that is caused, thus ensuring you do not suffer financially.*

3.    Safeguards against manmade hazards

You might see in the news about frequent incidents of fires caused due to faulty wiring, or the sprinklers not working in time. Even the absence of firefighting equipment in buildings can cause delays in the stopping of the fire. Often, builders use wiring of cheap quality to cut the cost, or at times, the connections are not properly installed. The fire safety systems such as smoke alarms and water sprinklers can also be of substandard quality. Such hazards can lead to a considerable financial loss for you if your house were to be damaged. A home plan provides ample financial coverage for the damages which can be caused due to negligence and cost-cutting.* Although a home insurance plan is not mandatory under any law, based on the benefits mentioned above, you can create a financial safety net for your family and your property from any harm that could be inflicted upon it.

What To Consider When Buying Home Insurance?

These tips can help you select a policy which offers great home insurance benefits:

1. Always compare what each insurer has to offer. Parameters for comparison include cost, claim settlement ratio, coverage amount, and customer reviews, among other things.
2. Check the add-ons that the insurer is offering.
3. If you are going for a comprehensive plan, customise as per your budget. Add-ons increase the price of the policy significantly.*
4. Prefer online purchase of the policy for a quicker buying experience and to enjoy savings on the premium.

Tips For Homebuyers

If you are looking to buy a new home, these tips can help you find the most suitable home:

1. Check the records for turnaround time of the builder. If the builder has a history of delay in giving the possession of the house, you should consider other developers.
2. Check for reviews related to the construction quality, amenities, and other facilities provided by the builder.
3. Check if the project is registered or not.
4. If the building is equipped with faulty firefighting system or does not have any system whatsoever, file a complain with the civic authorities.
5. Avoid purchasing a house on the top floors as it can cause a delay during emergencies when you want to access help.
6. Do not place combustible items in house as they can cause more damage in the event of a fire.

Conclusion

Going for this policy can help you avert any major financial loss that can arise from any damage caused to your house.* Before buying the policy, use the home insurance calculator to get a price quote, and then purchase the policy accordingly.   *Standard T&C apply Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.