Bundled policies come with a melange of interesting options
Home insurance package policies bundle a comprehensive, yet cost-effective fire and allied perils insurance with several other interesting options.
They include fire and burglary cover for contents, options to cover specified jewellery and valuables under a special section as also specified domestic appliances against breakdown and specified televisions and desktop computers against loss or damage.
Some policies have sections covering pedal cycles, workmen’s compensation insurance for household staff, hospitalisation insurance for household staff and so on that you can pick and choose from. Each section has a different sum insured (SI) and premium rate and there are volume discounts for choosing multiple sections.
Fire cover for building and contents and burglary cover for contents are the main covers and the options work like this:
If you live in a house you own, you can purchase fire cover for the building and contents plus burglary cover for contents. If you are the owner but not occupier, you are entitled to fire cover only for the structure. If you are only a renter, you can buy fire and burglary cover for only the contents. In any case, the SI for fire and burglary covers for contents should be identical.
We saw the scope of the fire cover for building in the earlier instalment of ‘Cover Note’ and it pretty much applies to contents as well.
The exceptions differ. They include loss of or damage to articles of a consumable nature, loss of or damage to money, securities documents and unset precious stones, jewellery and valuables.
The burglary cover indemnifies the loss of listed contents (except jewellery and valuables) within the premises caused by burglary, housebreaking, larceny and theft.
If anyone in the family of the insured is involved in the burglary, the loss will not be covered. Neither will loss of/or damage to money and so on as listed above.
The list is not exhaustive, you should read the fine print in the policy prospectus for exact details.
Precious jewellery and valuables like watches, curios and works of art are covered under a special section against loss or damage while anywhere in India, caused by accident or misfortune. In the case of damage, repair and restoration expenses are payable.
Breakage of fragile and brittle items is one exclusion, as are mysterious disappearances, unexplainable losses, loss due to misplacement and missing items.
An interesting cover is the breakdown of domestic appliances, the “unforeseen and sudden physical damage, including accidental external damage caused due to mechanical and/or electrical breakdown of domestic appliances” specified in the schedule when they are inside in the insured premises.
The SI is the market value of an item of the same kind and capacity. Repair expenses to restore the item to its former state will be payable. Loss or damage caused by wilful damage or gross negligence is an exclusion among others.
You can insure the loss of or damage to your televisions and desktop computers against fire and allied perils under a special section where the market value of the gadget is the SI and repair expenses will be payable. Exclusions apply, of course.
Listing out the contents of your home is the important part of taking this cover.
(The writer is a business journalist specialising in insurance & corporate history)
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