Every year we hear devastating news of floods, cyclones and other natural disasters causing havoc in different parts of India. It not only creates a state of panic amongst people but also causes severe damage to properties and impacts human lives.
In May 2021, cyclone Tauktae-inflicted damage in Gujarat were assessed at Rs 10,000 crore. In the same month, cyclone ‘Yaas’ damaged over 3 lakh houses in West Bengal, while cyclone ‘Gulab’ in Andhra Pradesh and Odisha destroyed residential, commercial and industrial buildings and caused damages worth over Rs 2,000 crore in October 2021. We also witnessed floods and torrential rains in many parts of Tamil Nadu, Kerala, and Maharashtra that impacted the lives of poor and rich alike. As per the National Disaster Management Authority, around 40 million hectares of land in India is exposed to floods (about 12 per cent of the total land area), and 5,700 km of the 7,516 km long coastal line is prone to earthquake, cyclones, and tsunami.
Natural calamities such as cyclones, earthquakes, and floods, which once used to be a rare phenomenon, have now become more frequent than ever. India’s unique geo-climatic conditions make us prone to such natural calamities and we witness property damages worth billions of dollars every year. While the government is taking all measures to mitigate the hardships of the affected regions, people have also started realising the importance of buying property insurance to protect their assets and valuables against such unforeseen circumstances.
While the emotional turmoil that any calamity causes can hardly be mitigated, having adequate property insurance could certainly prevent financial brunt borne by the families. Here are the different types of property insurance one can consider buying:
Home Insurance: Whether you live in a gated society or an independent house, a home insurance is essential for every homeowner. Despite the geographical location, a home is exposed to various external perils. Home insurance protects your property from multiple adversities like fire, explosion, and damage caused by airplane crash, among others. A home can also be insured against natural calamities like floods, storms, and earthquakes through a home insurance policy. One can also protect the home contents by taking a burglary policy.
There are three types of home insurance plans that are available in the market. In the first plan, the building structure, i.e., only the physical aspect of your home is covered. In the second plan, all the content of the house like your furniture and other personal belongings get covered. However, the same, typically, do not cover jewellery, but, at an extra premium, insurers may also cover jewellery up to a specified amount. Third one is a comprehensive plan that covers both the building structure and all the content of your house.
Home is considered one of the most valuable investments that one makes in their lifetime and rebuilding a damaged house can burn a hole in your pocket. So, whether you live in North India that is considered prone to earthquakes or live in areas that are prone to floods and cyclones, opting for a home insurance makes immense sense. However, make sure you understand all exclusions from the insurer well as generally, the home insurance product does not cover war, invasion, war-like operations, pollution, contaminations, consequential or indirect loss or damage, ionizing radiation, etc.
Commercial Property Insurance: Damage to commercial property can significantly impact businesses as it can suspend operations for a long time, leading to huge losses. According to estimates, 50% of the damages caused to buildings in cyclone ‘Gulab’ were incurred by industrial and commercial properties. A commercial property insurance typically protects commercial buildings such as office premises or standalone shops from potential damages and losses caused due to natural calamities, burglary, or fire. It not only helps reduce business risk, but also improves financial stability. Such insurance policies usually cover damages and losses caused due to fire, explosion, and natural calamities such as floods, storms, and earthquakes. But keep in mind that such policies usually only cover the physical structure. However, insurers may even cover the content of your building including valuables such as cash in safe or shop counter at an additional premium. Whether you own a shop or run a small, medium, or large enterprise, commercial property insurance can protect you and your business assets from multiple adversities.
Renters Insurance: If you have relocated to a city for a job, chances are you would be staying in a rented accommodation. Many tenants today live in prime locations and own expensive household items. However, many have a misconception that a property insurance can only be taken by those who own properties. But many are not aware that even a tenant can opt for property insurance by buying a renters’ insurance policy.
This policy protects tenant’s belongings in case of burglary, fire, natural disasters and more. A typical renter insurance policy includes liability coverage and protection against personal belongings. While tenants might not be able to prevent certain situations such as break-in or visitor’s injury, this insurance helps to minimize the impact.
Generally, renter’s insurance premiums are low, and one can easily buy them to protect their belongings. In most cases, a landlord may already have a home insurance that covers the building structure; so, there is no need to opt for a comprehensive home insurance policy. As a tenant, you can simply opt for a renter’s insurance to take care of your personal belongings inside the house.
Whether you are someone who owns a home or a commercial property, or you are a tenant living on rent, everyone irrespective of the geographical location can opt for a property insurance to safeguard their assets and belongings. Assess the policy benefits carefully and opt for a plan that best suits your needs.
Vivek Chaturvedi is Chief Marketing Officer and Head of Direct Sales, Digit Insurance
Disclaimer: The views expressed in the article above are those of the authors’ and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.
