What Are The Home Insurance Traps And How To Avoid Them?

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Your house is your biggest asset and taking every precaution to ensure its safety and security is your foremost priority. The best thing that you can do to safeguard your house against any damage and loss caused due to fire, natural calamities, theft, burglary, and other allied perils is to insure it under a home insurance policy.

However, just having a home insurance plan is not enough. You need to be wary while taking a plan as they usually come with sneaky clauses and exclusions. In case you miss out on some tricky clause mentioned in small print, misjudge a point, or forget to add something, you may end up being under-insured or paying the odds out of pocket.

Home insurance traps you should be well aware of

  • Being under-insured: While taking a sum insured policy, it is vital to estimate the value of the contents that you want to insure. If you underestimate the value of your house and its contents you may end up getting a lower payout which might not be sufficient to cover a lost or damaged at the time of need.
  • Undue excesses: Even if you are offered with a low premium price, you must check the excesses that you will have to pay from the pocket while filing a claim. Generally, lower policy premium calls for a higher excess amount. This means, though you will not be paying a lot now, you could end up shelling out a huge amount of money at the time of claim filing.
  • Damages due to accidents: Usually, the home insurance plans don’t offer coverage for unintentional damages caused to the insured building and its contents. Knocking over a piece of furniture, breaking the TV, or stepping through the ceiling are some of the examples of such accidental damages that most of the insurers don’t pay for and need to be included at an extra cost.
  • Vacant house: While most of the home insurance covers specify the period for which you can leave your house empty, sometimes it is not clearly stated in the policy papers. So, before leaving make sure to check the duration for which you can leave the house unoccupied and the conditions that apply if any mishap happens during that period.

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  • Leaving the house open: By mistake, if you haven’t locked your house or activated the burglar alarm before leaving the house and unfortunately a burglary takes place, your home insurance claim will most likely be turned down as you are the one accountable for the loss or damage caused to the insured property.
  • High risk and high-value items: Don’t miss out to specify high-risk items like mobiles, laptops, computers, etc. and high-value items such as watches, jewellery, precious metals, etc., to the insurer at the time of policy purchase. These expensive items are not included under the basic coverage and if included in the policy as individual items these may increase your premium cost. Thus, it is wise to insure such costly items separately.
  • Items kept out of the house: In circumstances where you take certain personal possessions like mobile, laptop, watch, jewellery, etc. out of your house, your home insurance policy will not be applicable. Moreover, you will be responsible to pay for any loss or damage caused to them while they were kept out of the house.

Moreover, in case you put a section of your house on rent or have a home-based business your basic home insurance policy may cease to apply. Therefore, inform your insurer about the matter right at the outset and consider buying a different type of insurance coverage than a regular one to avoid troubles during claim filing.

So, if you don’t want to get caught in the house insurance traps go through this guide from Compare Market Insurance and know about all the nitty-gritty of home insurance. Remember, having a clear understanding of the policy terms and conditions is vital to avoid the annoying home insurance traps.

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