Published in Mint on 30th April 2018. Written by Abhishek Bondia
Is it possible to get cashless coverage from two insurers simultaneously?
—Ravi B.
When the sum insured gets used up in one insurance policy, you can claim the balance amount from the second insurer. The second insurer will insist on the final claim settlement details from the first insurer. This is done to ensure that the aggregate amount reimbursed to you is not more than the actual expenditure incurred. The final settlement details are available only after discharge. So, it becomes difficult to take cashless claims simultaneously from two insurers. The accepted practice is to take cashless coverage from the insurer with higher coverage and then claim the balance amount as reimbursement from the second insurer.
I have an apartment on the 11th floor of a building in Noida. I am planning to buy home insurance. What features should I look for? How much will home insurance cost on average for a 3-bedroom apartment? Also, will an insurer pay if my floor gets completely wiped out due to an earthquake or any other natural calamity, as the apartment is not on any land per se?
—Supriya
There are broadly two kinds of home insurance coverage. The more prevalent type is the standard fire and special perils insurance for the construction cost of the house. This policy would insure the cost of reconstructing the damaged portion. The loss could be either partial or total. If you opt for this option, you should ask for earthquake cover as an add-on and insist on a reinstatement value clause. In the particular situation, you described, when the building is reconstructed, the policy would indemnify you for your pro-rata portion of the cost. For a 1,500-sq.ft home, assuming the cost of reconstruction is Rs4,000 per sq. ft, the sum insured will be Rs60 lakh. The cost of such insurance would be around Rs3,000.
Another option is an all-risk policy for flats on an agreed value basis. Only a few insurers offer this product. Here, you could take the registered value of the house as the sum insured. In case of a total loss, you can surrender the house to the insurer. They will indemnify you with the full sum insured. Since the house is at registered value, it includes the cost of land as well. For a 1,500-sq. ft house, assuming the current property rate is Rs10,000 per sq. ft, the sum insured will be Rs1.5 crore. The cost of such insurance would be around Rs7,000. I recommend the second one, as it frees you from dependence on reconstruction in case of total loss.
We are planning the wedding of our daughter in Goa in August, and rainfall is a likelihood. Can we buy insurance for such an eventuality?
—K.R. Patil
Wedding insurance is available. Such policies cover wedding cancellation, damage to property at the wedding venue, personal accidents for specific individuals, and third-party injury and property damage. Cancellation of the wedding due to fire, flood, storm, burglary, and earthquake are also covered. Specifically, water-related damages due to storms, cyclones, typhoons, tempests, hurricanes, tornados, floods, and inundation are covered.
In case of cancellation, expenses linked to the printing of cards, advances for the venue, caterer, decorations, and stay and travel will be reimbursed, subject to the policy sum assured. The policy would also cover wedding cancellations due to death, accidental disability, and hospitalization of specific individuals.
