Why Companies Should Include Home Insurance in their Corporate Insurance Policies

The Insurance industry is growing at a decent pace of 32% y-o-y. Health, Life and Motor are considered the most essential insurance policies. Home insurance penetration is at the lowest level despite so many disrupting factors in one’s life. When considering financial planning, earthquakes, fire, theft and floods are wholly ignored.

Home insurance is significant today as an individual’s lifetime savings are invested in their house. Home insurance protects the house from accidents, perils, damages, and thefts. If the house gets damaged, the emotional and financial pain of rebuilding or reinstalling its contents is painful, challenging, and expensive.

Consumers urgently need to protect their home investments through insurance, as the changing climatic condition today is getting unpredictable with the day.

While there were multiple natural calamities worldwide, India faced the fury of floods across many cities like Uttarakhand, Bengaluru and Chennai, which has become a yearly affair. Bengaluru met with an unusually wet monsoon last year; a similar situation is expected this year; over 600,000 people are affected by floods in North-Eastern India almost yearly. These grave instances draw our attention to the vital need for consumers to protect their houses and assets.

While general insurance companies offer home insurance, a small part of the population opts for it. As per reports, barely 3% of houses are insured in India, which leaves a huge gap and an opportunity for insurers to reach out to consumers with this kind of insurance. Companies today have become a massive catalyst in providing insurance policies to people. Many people depend on corporate/ group insurance policies as the only source of financial protection. Even SMEs can provide home insurance as a part of their corporate/ group insurance policy and gain the confidence and loyalty of their employees.

Here are a few reasons why companies should provide home insurance as a part of their corporate insurance policy:

Coverage for tenant insurance:Many people have been moving from smaller towns and cities to metro cities over the years. With changing dynamics of employment opportunities in cities, the influx of people in metro cities is increasing tremendously yearly. India is expected to add 416 million people to its urban population by 2050. The current growth rate and futuristic numbers leave a massive opportunity for companies to protect their employees with home insuranceconcerning their personal belongings and contents.

Companies can help employees get protected against liabilities: Companies can provide home insurance policies to provide liability coverage that covers personal injuries and property damage due to guests and other third parties (that they might have incurred while residing in the insured house). There could also be loss and damage caused to third parties for which the policyholder or their family members may be legally responsible. Hence, companies can provide home insurance coverage and protect the policyholder and their house from possible legal problems.

Huge financial protection in case of any natural calamity: In 2022, India witnessed natural disasters almost every day in the first nine months, which destroyed close to 4,50,000 lakh houses.Thus, companies should provide home insurance policies and protect employees'houses against losses and damages caused due to natural calamities like earthquakes, floods, lightning, storms, typhoons, etc.

The insurance policies can also protect the house from human-made hazards and anti-social activities, such as vandalism, thefts, strikes, riots, and other activities caused by malicious intent. People incur substantial monetary losses in the form of post-catastrophe destruction. Home insurance can protect valuable assets and precious personal belongings: Besides covering the house's structure, house insurance also offers policies to provide coverage against loss/ damage to articles/contents kept inside the insured home. These could include valuable, expensive, and essential belongings like documents, jewellery, clothing, appliances, furniture, etc. One can imagine the financial assurance any corporate house can give its employees by securing these valuable possessions by providing corporate home insurance policies.

Prudent financial planning usually requires financial protection for valuable assets, and companies today can play a crucial role in offering home insurance as a significant part of the group insurance policy. Home insurance is becoming important like health and life insurance in today’s scenario.

The article is written by Aftab Chaz, Associate Director and Business head at Elephant.in (Alliance Insurance Brokers)