For
flats, there is also the option of insuring the house on an agreed value basis.
Bajaj
Allianz’ My Home Insurance offers a comprehensive shelter against risks that
can befall your house
Bajaj
Allianz General Insurance had launched a new home insurance plan which covers
most risks, including earthquakes &
terror attacks. It has no compulsory excesses, which means the insurer
will bear the full cost of the claim without requiring the policyholder to pay
a portion of the claim amount from his pocket.
A
tenant or / owner of an individual house or apartment who is less than 30 years
of age can buy this policy.
Features
Also,
damage due to structural defects in the case of buildings and defective
workmanship of the contents are not covered. Independent houses can be insured
on a reinstatement or indemnity basis.
For
flats, there is also the option of insuring the house on an agreed value basis.
Under
a reinstatement plan, the sum insured is calculated by multiplying the area of
the building by the cost of construction on the day the policy is taken. When
there is a loss / damage, the policyholder will be paid an amount equivalent to
what he spent on reconstructing the building (as at the time of completion).
In
case of an indemnity cover, the policyholder will be reimbursed for cost of
reconstructing the building (as at the time of completing the construction),
minus depreciation in the value of the building (at the time of loss).
Our
take
To
take care of an increase in the cost of the building during the policy term,
both reinstatement & indemnity covers offer an option for escalation in the
sum assured up to maximum of 25% of the sum insured at the time of inception of
the policy. Reinstatement and indemnity covers are given by other insurers too.
What
is new in Bajaj Allianz’s policy is the option for arriving at the sum insured
based on an ‘agreed value basis’. Here, the house is insured for a sum
equivalent to the value of both the building and the land.
And
in case of a total loss situation (where the building is completely destroyed),
the insurer will buy the apartment from the policyholder for a guideline
value-based price (which is the value mentioned in the ready reckoner for
property tax & stamp duty by the State Government)
The
other differentiating factor for this policy is that you need not provide the
company with bills and documents validating the purchase of contents in the
house, provided you opt for a sum assured above Rs. 5 lakh. Also, there is an
inbuilt cover for expenses on rent in case an alternate accommodation has to be
found.
The
building insurance cover from Bajaj Allianz comes at an attractive price. The
cover for a Rs. 25 lakh apartment on reinstatement basis comes for nearly Rs.
1,100 for a year. Other plans available in the market charge a premium of about
Rs. 1,500 to Rs. 1,700 for the same sum insured.
For
contents insurance, however, the premium for Bajaj Allianz’s policy is higher.
The premium is Rs. 3,652 for contents worth Rs. 5 lakh covered on indemnity
basis. Other policies that offer indemnity cover for contents worth Rs. 5 lakh
charge a lower premium of about Rs. 1,500. One reason for the high cost could
be because the plan is more comprehensive than others in the market.
Besides,
it does not ask for bills for the insured contents if the value is Rs. 5 lakh
or / above. Also, if the insured
contents are worth over Rs. 5 lakh, in case of damage, it replaces the old item
with a new one.
In
the ‘agreed value basis’ cover, given the low probability of a building being
completely destroyed and the policyholder wanting to abandon it, one may have
to think twice before opting for this policy.
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