Which Is Why A Home Insurance Policy Is A Must

Category: Finance, Insurance.

Your home is one of your most precious possessions.

What s more unfortunate is the fact that it may not even take a few days for such a labour of love to be damaged. If you are not born with a silver spoon in your mouth, it may take you a lifetime of savings to buy a home of your own. Yes, your home looms under the threat of damage due to flood, fire, earthquake, and so many other mishaps. Obviously not! So, after making a reasonable investment on your new home, furnishing and even decorating it nicely, does it make any sense to leave it unprotected against the threat of damage? Which is why a home insurance policy is a must. But, it will help, of course the owner recover the losses caused by a calamity.

It will not work as a shield to protect your home from any kind of impending danger. As a basic rule, home insurance policies are divided into two different components- buildings insurance and home contents insurance. The later covers the precious things generally kept within the home. The former covers your home s bricks and mortar, meaning the physical structure of the home. Home insurance for contents covers possessions inside your home like furnishings, furniture and appliances. As per like for like basis, one will be provided with monetary compensation equivalent to the value of the insured item just before it was damaged. Insurance terms may be based on like for like or new for old compensation.

On the other hand, under the new for old terms, the insured will be provided with monetary compensation, with which the damaged item can be replaced with a new one. So, when you buy a Home Insurance policy, make sure that it covers important home contents as well as the related items, including garage or outbuilding s contents, garden contents, personal money, food in the deep freezer and loss of fuel or water.