Which Important Home Insurance Terms Should You Know

Which Important Home Insurance Terms Should You Know?

Even though home buyers are increasing continually, a home insurance policy is a rarely purchased financial product in India. People generally avoid purchasing this insurance due to insufficient knowledge about the product and the right financial providers, due to high premiums, or due to the complexity in availing the product.

Just like we prepare ourselves for the unfortunate incidents that could damage our vehicle, cause permanent/ temporary injuries, or lead to death, we need to financially protect our homes against damages caused due to natural disasters, theft, or fire.

What does a Home Insurance Cover?

Bajaj Finserv, one of the dominant financial providers of India with CRISIL’s FAAA and ICRA’s MAAA top rating offers a wide range of financial products to suit the varying financial requirements with a hassle-free application and claim procedure. One such prominent financial product is the home insurance. A comprehensive house insurance policy offers the following covers:

  • Loses incurred due to floods, fire, earthquake, and other natural and man made calamities.
  • Loss of valuables from the house due to burglary.
  • Loss of jewelry, works of art, and other valuables.
  • Rent for alternate accommodation under the additional benefits.
  • Add-ons like liability cover, key and lock replacement, loss of rent, etc.

What are the Important Insurance Terms You Must Know?

Policyholder

The individual who proposes the purchase of an insurance policy and makes the premium payment is known as a policyholder.

Premium

The sum that the policyholder needs to pay to keep an insurance plan active and enjoy the coverage offered is termed as a premium.

Premium Paying Term

The period until which the policyholder chooses to or needs to pay the premium for keeping the policy active is known as the premium paying term of an insurance policy.

Premium Paying Mode

Almost all financial providers offer the flexibility of paying off the premium amount in a monthly, quarterly, half-yearly, or yearly basis with a regular premium payment. With a limited premium payment, you get a choice to pay off the premium in a limited period during the policy term. With a single premium payment term, you get the option to pay the entire premium in one go at the initiation of the policy.

Sum Assured

The amount which is assured to be paid on the maturity or death of the policyholder or while making claims is termed as the sum assured.

Nominee

In case of life insurance policy, the chosen individual who will receive the death benefits of the policyholder dies during the policy term is known as a nominee.

Policy Term

The period until which the policy offers coverage to a person or property is known as the policy term of that insurance policy.

Claim

The request made by the policyholder/ homeowner for reimbursement under the terms and conditions of the policy is known as a claim.

Deductible

The sum that a homeowner needs to pay by themselves before the initiation of the coverage is known as deductibles.

Depreciation

The decrease in value of the property with time due to aging, wear and tear, and other factors are termed as depreciation.

Endorsement

Any document, clause, or provision added to existing property insurance is termed as an endorsement.

Underwriting

When you buy home insurance, the process adopted by the insurer to determine the eligibility and premiums for the policy coverage is known as underwriting.

How to Apply for Home Insurance Policy with Bajaj Finserv?

As mentioned above, the insurance policy application is a hassle-free and quick procedure with Bajaj Finserv. You can either provide basic details on the website or give a missed call on 09211 549 999. A representative from the company will soon contact you and guide you through the complete application procedure. However, a medical examination is mandatory for the acceptance of the policy.

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