Page 381 - IC38 GENERAL INSURANCE

for a home loan. A home loan is one of the longest debts in our life, which
requires a long term commitment. For the sake of procuring the loan we need
to take insurance to give to the banks and secure the loan.

Apart from the house as such, the contents of the house are also important. The
house would contain pieces of furniture and costly appliances like television,
refrigerator, washing machine etc. There would be some gold or silver
ornaments and artwork like paintings or curios. All these could be damaged by
fire, earthquake, flood etc. or stolen as well. As these possessions are
purchased at high values using family savings, losses would cause financial
hardship. Householders‟ insurance is a comprehensive policy that seeks to
address all the above situations.

b) What is covered in Householder‘s Insurance Policies?

Information

Package or Umbrella policies

i. Package or umbrella covers give, under a single document, a combination of
covers.

ii. For instance there are covers such as Householder‟s Policy, Shopkeeper‟s
Policy, Office Package Policy etc. that, under one policy, seek to cover
various physical assets including buildings, contents etc.

iii. Such policies may also include certain personal lines or liability covers.

iv. Package covers could have common terms and conditions for all sections as
also specific terms for specific sections of the policy.

Householder‟s insurance covers the house structure and its contents against
fire, riots, bursting of pipes, earthquakes etc. Apart from the structure, it
covers the contents against burglary, housebreaking, larceny and theft.

Jewelry whilst being worn or kept in locked safe can also be insured under
householder‟s insurance. Cover is also given for antiques and works of art.

Householder‟s insurance also provides coverage for loss of personal baggage,
electrical and mechanical failure of domestic and electronic appliances. Some
insurers also provide coverage for pedal cycle, personal accident and workmen‟s
compensation.

Losses normally covered include fire, lightning, explosion and aircraft fall /
impact damage (commonly known as FLEXA); storm, tempest, flood and
inundation (commonly known as STFI); and burglary. Coverage differs from
company to company and from policy to policy. With the growth of High
Networth Individuals (HNIs) who own expensive homes, there is a growing need
for this insurance.

375