Home >Money >Q&a >A householder’s policy does not cover alterations, improvements
Photo: istock
Photo: istock

A householder’s policy does not cover alterations, improvements

In an order issued by the ministry of home affairs in April, it was made mandatory for firms to offer health insurance for all its workers

My house was damaged in the recent cyclone in West Bengal. I have a householder’s policy, which covers damages. Will the insurer send workers or I have to arrange for them? Also, to what extent will the repairs be made? Will the policy also cover whitewash and alterations?

—Name withheld on request

The company pays for the repairs, it does not send workers. You would have to get the damages repaired yourself. The repairs covered under the policy would be to restore the house back to the condition in which it was prior to the cyclone. To process your claim, you would have to inform the insurer of damages at the earliest and make sure that no further damage or restoration is done until the company sends a surveyor to assess the damage, and asks you for estimated repair costs. As you get the house repaired, you should submit the bills to the insurer. The surveyor would submit a report based on the damages and the expenses incurred, and recommend to the insurer the amount payable. The insurer would then approve and pay the amount.

Whitewash and alterations, if not damaged, would not be covered. This means that if your house did not have whitewash prior to the cyclone, the cost of the whitewash would not be covered. Alterations or improvements are not covered, unless it is not feasible to reconstruct the old design. Surveyors would typically deduct the improvements carried out from the recommended claim amount.

I have a manufacturing unit and I plan to start production soon. If my workers come to the factory, do I have to provide insurance? How much would it cost?

—Name withheld on request

In an order issued by the ministry of home affairs in April, it was made mandatory for firms to offer health insurance for all its workers. However, subsequent standard operating procedures issued have been silent on this issue. Since the latest guidelines override the older ones, by virtue of omission, one can assume that workers’ insurance is no longer mandatory.

In response to the earlier order, insurers had launched special group health plans. The sum assured in these plans start at 50,000. It is possible to design the plan to cover only employees, or extend the coverage to spouse, children and parents. Plans start at 1,000 per employee, excluding taxes for a seven-employee firm.

Abhishek Bondia is principal officer and managing director, SecureNow.in. Queries at mintmoney@livemint.com

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