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A Tale of ‘No Home Insurance’

3

KKM Mahesh is a retired government officer, currently residing with his children in Bangalore. He has a beautiful house in Chennai, built over a period of time by the couple, with their life long savings.

Mahesh didn’t want to leave the house lying vacant so has let out half of it as a means to cover up those recurring house expenses.

In fact, the floods which swept Chennai last year did not really affect his house and he was grateful for that. He believes he took a very prudent decision buying his retirement ‘Dream House near the sea and away from the busy central areas of Chennai.

His friend Guruprasad who owns a similar house close by had recently purchased a home owners packaged policy for Rs.1cr. He explained to Mahesh the benefits of the policy, which were as below –

Package policy – Home Insurance

Structure including contents

Sum assured – Rs. 1,00,00,000
Premium/year – Rs. 25,000

This included furniture, electrical items like fridge, television and other gadgets, jewellery, kitchen appliances, other general items and even boundary walls and fences. The policy allowed the contents to be covered for 5 years and structure for 10 years at a stretch.

Guruprasad suggested Mahesh should buy a similar cover for his house. But being a person who thought twice before spending every rupee, Mahesh felt those few thousands were just waste of money. Guess, he was a bit too off mark.

It was during Cyclone Vardah that the need for Home Insurance cover dawned on him.

With the cyclone landing in Chennai, in a matter of few days, the surroundings of his house turned from the beautiful flora to mud and debris. The trees came crashing into the house and all his prized possessions lost their worth. Life came to a standstill!

Gosh! How could he be so myopic in his outlook towards the greater benefits of a Home Owners Packaged Insurance? Under present circumstances, the insurance company paid out sum assured upto the damages incurred (Rs.50Lacs) to his friend Gururprasad while Mahesh had to search for ways to finance the restoration of his house and its contents.

He wondered, only if he had taken the home insurance policy, he would have been at peace of mind today.

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