What are the requirements to purchase a property insurance policy?
The proposer of the policy should first and foremost have an interest in the assets being proposed for insurance, i.e. he/she should stand to lose financially in the event of loss or damage to such assets. Secondly, the proposer should submit a proposal form. The proposal form should disclose all details, which are true to the insured’s best knowledge and other information, which the proposer may feel is relevant.

What are the different types of Property Insurance Policies?
Bharat Griha Raksha, Bharat Sookshma Udyam Suraksha, Bharat Laghu Udyam Suraksha and Standard Fire & Special Perils Policy provides cover for properties against Fire and Allied Perils such as earthquake, flood, riots, malicious damage, lightening, impact damage etc. Further, loss or damage to assets due to burglary and theft can be covered under a Burglary & House Breaking Insurance Policy. Valuables can be covered under All Risks Policies and there are package policies for house owners and shopkeepers.

How does one fix the sum insured?
Generally, there are two methods. One is Market Value (MV) and the other is Reinstatement Value (RIV). In the case of M.V, in the event of a loss, depreciation is levied on the asset depending on its age. Under this method, the insured is not paid amount sufficient to buy the replacement. In the RIV method, the Insurance Co. will pay the cost of replacement subject to ceiling of Sum Insured. Under this method, no depreciation is levied. One condition is that the damaged asset should be repaired / replaced in order to get the claim. It may be noted that RIV method is allowed only for FIXED ASSETS and not for other assets like stocks and stocks in process.