Theft insurance can help you guard against any unforeseen loss. But check out the caveats

AN OUNCE of prevention is worth a pound of care. Not convinced? Ask 45-year-old Ashok Arora. His house was buzzing with activity, as the marriage of his only daughter was only three days away. The family along with relatives went to attend a pre-marriage ceremony. Late at night, when they returned home, they were shocked to see that the lock had been tampered with. Inside, everything was upside down and burglars had decamped with almost all their valuables, including relatives’ jewellery.
   A shattered Arora now rues why he didn’t go for burglary insurance. In fact, most people don’t understand the importance of such a cover and sometimes, lose their hard-earned money in thefts. Here’s an insight into why you should buy burglary insurance, its pros and cons and is it a better trade-off than opting for customized policies.

DOs & DONTs

Insurance experts advise that one must check the exclusion clauses carefully before opting for a burglary insurance cover. In a recent judgment, the Supreme Court has redefined ‘burglary’ for insurance. The policy against burglary and house-breaking must now prove that there was use of force or violence during the incident. As a prospective policy holder, the first thing you must do is to ask your agent to explain the benefits of the policy. Then only you should furnish a declaration detailing all the items to be covered with its market value. Wherever necessary, a valuation certificate should also be submitted from an approved valuer. In case of any mishap, this will help you as well as the insurance company make a hassle-free settlement of claim.
   Before buying a policy you should understand its scope and coverage. You should apply for a suitable sum insured that reflects the value of household contents and appliances. Further, experts caution that items covered under the policy should be kept properly and valuables such as gold ornaments should be kept under lock and key. Items should remain at the insured place of address and not be kept elsewhere as this will then go against policy terms.
Due care must be taken to file an FIR regarding the burglary immediately. During the claims process, you must remember to obtain non-traceable certificate from the police and submit it to the insurance company.
   In India, all public sector insurance companies and a majority of private companies offer burglary insurance. However, some companies combine the burglary cover with fire and allied perils and offer it under household insurance.

CUSTOMISED VS STANDALONE

Before diving deep into the debate, you should know what a customized policy is. According to insurance experts, it is a series of covers that are designed for the insurer. It’s like ‘product bundling’ and provides more flexibility. For the insurance company, the costs of underwriting each cover separately are addressed and customer service becomes more convenient. It will take some time for pure retail policies such as household cover, burglary or medical insurance policies become a rage in India.
   Perhaps, that’s why you should favor customized policies. They are always advantageous to policy holders as they can cover items of their requirement, but with slightly higher premium. However, the availability of customized policies does not mean that the burglary policy has become irrelevant because it has its own advantages.
   Customized or standalone, it is a decision you have to make depending on your requirements. But what you shouldn’t forget is that theft is a possibility and you should opt for a proper cover.

THINGS TO REMEMBER:

• Check the exclusion clauses properly
• Disclose all assets to be insured properly and keep all bills and back up papers properly recorded.
• Immediately file an FIR on noticing a burglary
• Insured should obtain non-traceable certificate from the police and submit it to the insurance company