What Is the Importance of a Building Insurance Policy?
Building Insurance is essentially a property insurance policy that provides reimbursement if the building suffers from any damage due to fire, theft, or other natural calamities. A Building Insurance Policy is usually purchased by a Housing Society and hence it is also known as a Housing Society Insurance Policy.
So, a building insurance policy is essentially a fire insurance policy which covers the building structure from any damage on account of fire and related perils. A Building Insurance Policy can also be extended to cover the contents inside the home as well.
What are the Coverages under a Building Insurance Policy?
Bharat Griha Raksha is a standard insurance policy offered by many insurance companies, which gives insurance cover to the building structure and the contents.
Bharat Griha Raksha Insurance Policy offers following types of covers:
Building Structure Cover provides coverage for the building structure. The Building Structure also includes additional structures that are on the same site such as garages, parking spaces, compound walls, fences, gates, retaining walls, internal roads, septic tanks, fixed water storage units, tanks, solar panels, wind turbines etc.
Contents Cover provides coverage for the articles or things inside the home such as furniture, electronic items, antennas, solar panels, water storage equipment, kitchen equipment, electrical equipment, clothing, apparel items etc.
The Bharat Griha Raksha Policy has an inbuilt cover for the following:
1. Architects, Surveyor, Consulting Engineer Fees: The Housing Society Insurance Policy will pay upto 5% of the Claim Amount for reasonable fees of Architects, Surveyor, Consulting Engineers.
2. Removal of Debris: The Housing Society Insurance Policy will pay upto 2% of the Claim Amount for Removal of Debris
3. Loss of Rent Cover will pay the Insured Party the rent lost due to damage to the Insured Building on account of an Insured Peril.
4. Rent for Alternative Accommodation Cover under the Bharat Griha Raksha Insurance Policy will pay the Insured Party the difference in rent if the Insured is living in the home as a tenant and he has to shift to an alternative accommodation because the home that he was living in got damaged due to an Insured Peril.
What are the optional Add-On Covers under a Building Insurance Policy?
1. Valuable Contents Cover consists of items such as jewelry, paintings, works of art, silverware, antique items and other similar items whose value cannot be readily ascertained. These items can be insured on an Agreed Value Basis under the Valuable Contents Cover provided that a valuation certificate is provided
2. Personal Accident Cover under the Bharat Griha Raksha Policy covers the Insured’s life or spouse’s life in the event of an accidental death due to an Insured Peril that caused damage to the Building Structure or the Contents of the insured property.
What are the exclusions under a Building Insurance Policy?
The major exclusions under a Building Insurance Policy are as follows:
1. A Building Insurance Policy will not pay for any losses or damage due to willful or intentional act or omission by the Insured Party
2. Cost or Expenses incurred in Claim Preparation are excluded
3. Loss of Insured Property which is missing or whose disappearance cannot be explained
What Are the Advantages of Building Insurance Policy?
1. The prime advantage of a Housing Society Insurance Policy is that it provides cover to both, the main building structure and any peripheral structures like garages, sheds, fences, etc. from fire, theft, and other natural calamities.
2. A Building Insurance Policy also provide expenses towards rent for alternative accommodation since the Insured Person would have to shift to alternative premises until the damage building or home is repaired
3. A Housing Society Insurance Policy can be combined with a Commercial General Liability Insurance Policy to provide coverage for legal expenses and compensatory damages for any form of Bodily Injury or Property Damage suffered by third parties