Owning a property involves a considerable amount of money. Whether you use the property for residential or commercial purposes, any damage to the property can be financially challenging. You might have to spend a considerable amount of money in getting the damages repaired or replaced. Such costs might pose a financial strain and that is where an insurance policy can help you. There are different types of insurance plans available in the market. These plans help insure different assets, like property and compensate you against financial losses. In fact, when it comes to property, there are different types of insurance plans to cover different types of properties. Let’s have a look –
Types of property and corresponding insurance plans
Type of property – Residential property
Insurance available – Home insurance
If you own a home for residential purposes, you can buy a home insurance policy on the same. A home insurance policy usually comes in three types. These are as follows –
| Building structure insurance | This policy covers the damage or destruction of the building of the house and its structure. The perils that are covered include natural and man-made calamities like fire, flood, lightning, strikes, etc. |
| Content insurance | Content insurance covers the contents of the house, like furniture and fittings, electrical appliances, personal belongings, etc. If the contents get damaged due to covered perils or if they are stolen, the financial loss is compensated. The covered perils include both natural and man-made causes |
| Comprehensive insurance | As the name suggests, this policy covers both the structure of the house as well as its contents. It, thus, provides all-around coverage to homeowners and homebuyers against possible financial losses. |
If you are a homeowner or homebuyer, a comprehensive home insurance plan would be the ideal choice for wider coverage. Tenants, however, can opt for content insurance plans to insure the contents of their rented house against damages and theft.
Type of property – Construction sites
Insurance available – Construction All Risk Insurance
If you are a contractor engaged in the construction of a property, the property remains under your responsibility till the construction is completed. If the construction site suffers any damage due to natural or man-made causes, you might incur considerable financial losses. This is where a Construction All Risk (CAR) insurance plan can help.
A CAR policy covers the construction of different civil engineering projects like roads, highways, airports, etc. Under the policy, you get coverage against fire, lightning, collapse or collision, theft, burglary, landslide, water damage, etc. These perils might damage the construction site and are, thus, insured under a CAR policy.
Additional Read: What options are available for a property owner to arrive at Sum-Insured?
Type of property – Commercial property
Insurance available – Different types of plans are available for different types of commercial property
Commercial properties can be of different types – offices, showrooms, factories, warehouses, etc. As such, there are different types of commercial insurance plans available to cover such properties. Have a look –
Office Insurance
An office insurance policy covers office premises against possible perils like fire, cyclone, hurricane, floods, etc. Also called an office package policy, the coverage is available for public offices, private offices, call centers, and the like. Moreover, the plan can be extended to cover other office-related perils like the dishonesty of employees, personal accident insurance for the owner of the business, etc.
This plan even covers theft and burglary of office assets and any relevant damages. You also get coverage against third-party legal liabilities that you might face for a third-party injury or property damage due to your office premises.
Factory and warehouse insurance
A factory and warehouse insurance policy covers factory premises and/or warehouses that ‘businesses might have. The premises of the factory or warehouse as well as its contents can be insured against natural and man-made perils. Moreover, the policy also offers optional extensions that help in enhancing the scope of coverage.
There are different types of factory and warehouse insurance plans like floater policies, valued policies, comprehensive policies, specific policies, etc.
Shopkeeper’s insurance policy
A shopkeeper’s insurance policy is designed for shops and showrooms. Thus, owners of such businesses can opt for this policy and get coverage against the financial perils that their establishments face. These perils include fire, storms, aircraft damage, explosion, flood, burglaries, earthquakes, etc. You can opt for coverage only against the premises of the shop, only for its contents, or for both the premises and its contents.
So, depending on the type of property that you own, you can opt for a general insurance policy to cover possible financial losses related to the property that you might incur.
Additional Read: How does an insurer decide on the premium to be charged for property insurance?
Tips for insuring your property:
When insuring your property, here are a few tips that prove helpful –
- Declare the right value of the property that you wish to insure. Underinsurance can incur considerable out-of-pocket expenses when you incur a claim.
- Different property insurance plans have different coverage benefits. Compare the plan offered by different companies and choose one that offers the most relevant coverage for your property.
- When comparing property insurance plans, compare the coverage vis-à-vis the premium. Do not compare plans only on the basis of their premium rates.
- Optional coverage extensions are available under most insurance policies. So, check the list of such extensions and choose the relevant ones for an all-inclusive scope of coverage
- Most insurance plans come with a tenure of one year. Renew the policy regularly to enjoy continued coverage.
- If you have expensive items which need coverage, declare them when buying the policy. You can insure such expensive items separately. Alternatively, you can consider asset insurance plans for covering specific assets that you own.
The bottom line
Perils are unexpected and unavoidable in most cases. Thus, to secure your finances, a relevant insurance plan becomes necessary. So, understand the different types of property covered under insurance plans and choose relevant solutions. You can also opt for two or more types of policies if you own multiple properties. Independent coverage on each property might provide you with optimal coverage so that if there is damage or a loss, the policy can shoulder the financial burden.
