Property insurance is essential for protecting your home or business establishment. Whether you own residential or commercial property, a valid insurance plan provides security against incidents like theft, natural disasters, or even man-made disasters such as fire.
These policies not only protect the physical structure but also cover the assets within your property’s territorial boundaries. In this guide, you will gain a complete understanding of the various types of property insurance plan.
Different Types of Properties Covered in a Property Insurance
The following property types can be protected upon buying a property insurance policy:
- Residential Properties: These include individual apartments, houses, and other accommodation options.
- Commercial Properties: Commercial property insurance protects office buildings, retail establishments, and other businesses.
- Industrial Properties: Manufacturing units, warehouses and factory establishments come under this type.
- Land: You may also safeguard vacant plots and agricultural land via suitable property insurance
Exploring the Common Types of Property Insurance in India
With a motive to provide you with a clearer idea, here we have explained all the major forms of property insurance policies:
1. Renter’s Property Insurance
Renter’s insurance helps to protect against financial losses whenever assets in a rented property are lost due to unfavourable human or natural causes. This includes jewellery, among other valuables, electronic products, pieces of furniture, and others. In some policies, coverage on liability is also extended to compensate for claims from the property owner.
Some business owners also resort to renter’s insurance to protect their business establishments in case they lose possessions or products stored in a third party’s storage place.
2. Homeowner’s Property Insurance
Although different types of property insurance policies are available in India, they are still mostly purchased by house owners.
Home insurance policy provides financial support for damage to personal property from natural disasters or man-made events, for example, fire, theft, earthquakes, or burglaries.
Apart from insuring your property, it also covers your contents within the house. In addition, most reputed insurance companies also cover the losses that arise due to leakages and overflows in the water tanks or pipes.
3. Commercial Property Insurance
Like other property insurance policies, commercial property insurance safeguards against financial loss arising from natural and man-made calamities. However, it is particularly for business-usage properties.
It has to be noted that this type of insurance is not the same as commercial general liability insurance. A commercial property insurance plan covers your property, whereas commercial general liability insurance covers the third-party liabilities related to your business.
4. Public Liability Property Insurance
The most purchased P&C type of insurance among business organisations in India is public liability property insurance.
This will give you the much-needed coverage for a potential third-party loss that may occur at your establishment. Under the provisions of the Environment Protection Act of 1986, every businessman, cafe owner and car garage owner must hold a public liability property insurance plan.
Also Read: How Unique Home Design Features Can Cause Issues for Homeowners
5. Fire Property Insurance
One of the main consequences of most fire outbreaks is property destruction. These accidental fires can happen for many reasons, and their aftermath is mostly characterised by tremendous property damages that the owner has to compensate for.
Purchasing a fire insurance policy for business and residential premises can prevent this. However, keep in mind that a fire insurance policy will not be beneficial when losses are due to a fire disaster caused by negligence.
Common Limitations and Exclusions in Property Insurance
Although property insurance plans provide the policyholder with sufficient coverage, it is wise to recognise the common exclusions.
That said, there are some limitations under which you cannot file a claim based on your property insurance:
- Wear and Tear
These include damages incurred due to normal ageing and regular use of amenities.
- Acts of War
Under this, a property insurance company considers losses caused by military actions or other war acts.
- Floods and Earthquakes
While a regular property insurance policy does not encompass these two elements, residents of flood or earthquake-prone areas can choose to augment their coverage with additional riders.
- Negligence
These comprise small or significant damages that may arise due to consistent failure to maintain the property.
How to Select the Right Property Insurance Online?
Considering going through the following factors while choosing property insurance:
- Evaluate Your Requirements
Determine what coverage you need depending on your property’s type and how you use it.
- Compare Online
Check out various insurers and their coverage options. You should visit the official websites of the companies to find out precise insurance costs.
- Understand the Policy Details
Thoroughly read the terms and conditions to clarify any doubts regarding the coverage, exclusions, and any limitations. Moreover, you can contact them if you have a question that is not answered in the website’s FAQ section.
- Compare the Premiums
Ensure that the premium fits your budget while offering the desired coverage.
- Check Reputation for Customer Support
In the end, you should choose an insurance company known for excellent customer service and a straightforward claims procedure.
On a concluding note, this guide focuses on why it is important to get a clear understanding of what property insurance covers and the different subcategories that come with it. However, please understand that property insurance is not only an effort to safeguard a specific space but also to protect your financial future.
Must Read: 8 Factors That Could Invalidate Your Home Insurance