Home Insurance for Bangalore Flat Buyers: Bharat Griha Raksha Explained
Home insurance pays for repairs or rebuilding when a fire, flood, storm or similar event damages a home. Most flat owners in Bangalore insure the car and the phone and leave the flat itself without cover. This guide explains the standard policy sold in India, how the sum insured is set, how it differs from the cover a bank sells with a home loan, and what a flat owner should check before buying.
What Home Insurance Covers
A home policy has two parts. Building cover protects the structure: the walls, floors, roof, fixed fittings and permanent fixtures. Contents cover protects movable things inside the home, such as furniture, appliances, clothes and electronics.
The policy responds to sudden events named in it. Slow damage is outside its scope, so seepage that builds up over years, wear and tear and poor upkeep remain the owner's cost. The land under the building is also outside the cover, as land survives a fire or a flood.
Bharat Griha Raksha: The Standard Policy
Bharat Griha Raksha is the standard home insurance policy designed by the insurance regulator, IRDAI. Every general insurer that sells fire insurance has had to offer it from 1 April 2021. The wording is the same across insurers, so a buyer compares only the premium, the service and the add-ons.
The policy covers the building, the contents or both against a long list of events:
- Fire, explosion, implosion and lightning
- Earthquake, storm, cyclone, flood and inundation
- Subsidence, landslide and rockslide
- Impact damage from a vehicle or a falling object
- Riot, strike, malicious damage and acts of terrorism
- Bursting or overflowing of water tanks and pipes
- Theft within seven days of any of these events
Three features make the standard policy friendly to a home owner. General contents are covered automatically at 20% of the building sum insured, up to Rs. 10 Lakhs, with no list of items needed. The policy also waives the under-insurance rule, so a claim is paid up to the sum insured even when that sum is lower than the true value.
The third feature is cover for rent. When an insured event makes the home unfit to live in, the policy pays the rent of an alternative home during repairs, or the rent lost by an owner who had let the flat. Optional covers are available for jewellery and valuables, and for personal accident to the owner and spouse.
How the Sum Insured Is Set
The building is insured for the cost of rebuilding it, and the market price of the flat plays no part. The market price of a Bangalore flat includes the value of the land share and the location, which insurance does not cover. The rebuilding cost is the built-up area multiplied by a construction cost per sq ft.
An illustration shows the gap. A 1,500 sq ft flat priced at Rs. 1.5 Crore, insured at an assumed construction cost of Rs. 3,000 per sq ft, carries a building sum insured of Rs. 45 Lakhs. The automatic contents cover on that sum is Rs. 9 Lakhs.
The premium follows the sum insured, the city and the cover chosen, so it is a small fraction of the price of the flat. A sum set too low limits the payout in a major loss, and a sum set at the market price wastes premium. Construction costs rise each year, so the sum insured is worth revising at every renewal.
Home Insurance, Loan Protection and Term Cover
Three products are often mixed up at the time of a home loan. The table below shows what each one protects:
| Product | What It Protects | Who Receives the Money |
|---|---|---|
| Home insurance | The building and contents against damage | The owner, or the lender where the policy is assigned |
| Home loan protection plan | The outstanding loan on the borrower's death or disability | The lender, to close the loan |
| Term life insurance | The family's income needs on the death of the earner | The nominee |
A loan protection plan sold with the loan does not insure the flat. It is a life cover linked to the loan balance, and its single premium is often added to the loan amount, which raises the EMI. The EMI calculator shows the effect of a higher loan amount on the monthly payment.
The law does not require a home owner to insure a home. A lender may still ask for property insurance as a condition of the loan, as the flat is its security. The borrower should ask which of the three products is being offered, what it costs and whether a policy from another insurer is accepted.
What a Flat Owner Needs
An apartment has two layers of insurance. The owners' association usually insures the common structure and shared equipment: the lifts, generators, pumps, clubhouse and basements. That policy covers the association's property and leaves the inside of each flat to its owner.
The owner's own policy covers the interior of the flat, including the flooring, woodwork, kitchen, wiring and fittings, along with the contents. A fire that starts in one flat can also damage the flat below, so the interior cover is worth having even in a well-insured building. A tenant needs only contents cover, as the structure belongs to the landlord.
Flood cover deserves attention in Bangalore. Several low-lying layouts and apartment basements have gone under water in heavy monsoons. Home insurance covers flood damage to the building and contents, while a car parked in a flooded basement is claimed under its own motor policy.
Making a Claim
A claim goes smoothly when the paperwork is ready before the event. The steps below are the usual sequence:
- Inform the insurer at once, and the fire service or police where the event calls for it
- Photograph and video the damage before any clean-up
- Prevent further loss, for example by shutting off water or power
- Wait for the surveyor's visit before starting major repairs
- Submit the claim form with repair estimates, bills and the list of damaged contents
A simple inventory of the contents, with purchase bills for costly items, saves time at this stage. The policy document, the sale deed copy and the association's policy details belong in the same folder. A digital copy stored outside the home is useful when the flat itself is damaged.
Checks Before Buying a Policy
The points below help a Bangalore flat buyer choose the right cover at possession:
- Decide between building cover, contents cover or both, based on ownership
- Set the building sum insured on the rebuilding cost, leaving out the land value
- Declare a higher contents sum when belongings exceed the automatic limit
- Add jewellery and valuables cover where needed, as they are outside general contents
- Read the exclusions, including wear and tear and gradual seepage
- Ask the association for a copy of the building policy and its sum insured
- Compare the standard policy across two or three insurers before paying
The right time to buy is the day of possession, when the interiors are new and the loan is at its highest. A long-term policy saves the trouble of yearly renewal, and the sum insured should still be reviewed after major interior work. Home insurance is a small yearly cost that protects the largest purchase most families make.