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HOMEOWNERS INSURANCE POLICY – UNDERSTANDING WHICH LOSSES ARE COVERED

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We started a new series of discussion on Home Owners Insurance Policy last week and we examined the items covered under the policy. Having understood this, we now need to examine the degree of protection provided by the policy and those losses that the policy would provide compensation against.

Before we proceed, we summarize our last discussion below;

Summary of the items covered under Homeowner Policy:

1.       Damage to the building

2.       Loss of or damage to contents

3.       “All Risk ” cover for personal effects

4.       Additional expenses for alternative accommodation

5.       Loss of rent

6.       Public liability extension

7.       Compensation for death of the insured.

Kindly read up the full post here

The insured perils under Homeowners Insurance Policy

This would basically be a recap of what we discussed under Fire & Special Perils Insurance (read here)and Burglary Insurance (read here) but with some little additions and adjustments.

Peril A. Fire damage

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1. Fire – covers damage caused;

I. Directly by fire

II. By water used in extinguishment or by other extinguishing agents.

III. By fire brigade while fighting the fire.

IV. By smoke.

V. By falling walls or part of a building in which a fire takes place.

2. Lightening – covers damage caused

I. By fire resulting from ignition brought about by lightning

II. By thunderbolt

3. Explosion 

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Cover is limited to explosion of Boiler and of Gas used for domestic purposes (that is home use) only.

4. Aircraft:

This covers damages caused by aircraft or other aerial devices or articles dropped from them. But it excludes damages caused by air waves produced by them. This is because there is no physical impact.

If an item falls from an aerial device and damages your property or objects from a crash scene damages your property, it is covered under your fire insurance. However, damages not directly related to impact (airwaves or sound damage) is not covered.

5. Riot, strike and lock-out workers:

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This covers damage directly caused by:

I. The act of any person(s) taking part together with others in any disturbance of the public peace.

II. The willful act of any striker or locked-out worker done in furtherance of a strike or in resistance to a lock-out;

III. The act of any lawfully constituted authority in suppressing or to suppress any such disturbance. Hence, damage to your property by the police in an attempt to enforce low and order is covered.

It however excludes

I. Act of terrorism

II. Consequential loss

III. Communal and/or religious disturbance

6. Malicious Damage: 

Damage to the property insured directly caused by the malicious act of any person (whether or not such act is committed in the course of a disturbance of the public peace) other than damage arising out of theft or any attempt threat.

7. Earthquake Or Volcanic Eruption Damage:

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This also includes flood or overflow of the sea occasioned thereby.

8. Storm, Tempest, Flood & Tornado

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This peril excludes damage caused by

I. The escape of water from the normal confines of any natural or artificial water course or lake reservoir canal or dam or any water tanks apparatus pipes.

II. Inundation from the sea whether resulting from storm or otherwise.

III. Frost, subsidence or landslip

IV. To any outdoor fixtures and fittings, gates and fence and movable property in the open

V. To premises in course of construction, alteration or repair

VI. Water or rain except rain or water entering the building through openings made by the direct force of the storm or tempest or flood or tornado

9. Escape Of Water From Any Tank, Apparatus Or Pipes

This peril excludes damage

I. By water discharged or leaking from an installation of automatic sprinklers

II. In respect of any unoccupied buildings.

III. Damage caused to such tank or apparatus

10. Impact By Any Road Vehicle Or Animal

Also covers damage to property by any road vehicle or animal neither belonging to nor under the control of the insured or any occupier of the premises or their respective employee

 

Peril B. Burglary or House-Breaking

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1.    Loss of or damage to contents following theft accompanied by actual forcible & violent breaking into or out of a building or any attempted theft. However cover is suspended if the building is left unoccupied over a period of time.

2.    Damage to building following a burglary or house-breaking

Peril C. “All Risk”

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Peril A and B are regarded as “Premises Risk” because they can only occur at where the building is situated. However, All Risk extension extends the cover of the policy (to the items under this section) against loss or damages anywhere outside the insured building provided such items is still within the geographical limit of the country.

Thank you for reading. We would like to have your view and also know if this post has been of any benefit to you. Kindly leave a comment.

 

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