Home insurance also referred to as homeowners insurance is a type of property insurance that covers homes. You should however note that the home must be a private home. Home insurance policies combine several protections which include; damages to the home, loss of its use and liability for accidents that might occur at the home.
The cost of home insurance depends on several factors. One of the factors is the cost of replacing the home as well as riders attached to the policy. Riders refer to additional items that are insured together with the home. A home insurance contract is quite detailed and includes what constitutes a legal claim and what does not constitutes a legal claim. For instance, losses due to floods and wars are not included in the contract hence losses due to these events will not be covered by the insurance company. However, you can purchase special insurance policies that cover losses arising as a result of floods, fire and any other natural calamity.
Home insurance policies are term contracts. This means that the contract is in effect for a fixed period of time which is agreed upon by both parties. The contract terms require the insured to pay premiums either monthly or in lump sum payments. Most insurers charge lower premiums if the home to be insured is according to them less likely to be damaged.
If you indeed suffer a loss that is covered by the policy, you should file a claim with the insurance company so as to receive your money. However, you must prove that you actually incurred losses as a result of the occurrence of the event stated in the policy. If the insurance company is not satisfied, they can launch an investigation into the real cause of the event. The insurance company will also assess the value of the damaged property and then offer a settlement amount which is negotiable.
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