Majority Indians don't have home insurance despite risk awareness: survey

Bajaj Allianz asked around 1,200 people from metros across the country as part of the survey

While most Indians are aware about the risks around earthquakes and natural calamities for their houses, they still do not purchase home insurance. A survey by Bajaj Allianz General Insurance said that though 75 per cent of respondents were aware that home insurance was essential, only 30 per cent of the respondents had home insurance for either their home or its contents.

As per the survey, 64 per cent of homeowners felt earthquakes and other natural calamities were the biggest risks their homes were exposed to, followed by fire (28 per cent) and thefts and burglaries (8 per cent).

Among those who lived on rent, 56 per cent believed natural calamities were the biggest threat to their homes. Further, 30 per cent of them said fire was a major risk and 14 per cent termed thefts and burglaries as risks.

Home insurance penetration in the country is at a dismal 0.07 per cent. The demand for this cover was low because the general public found home insurance products and clauses complicated and difficult to understand, revealed the survey.

It showed that most of the respondents were aware of home insurance as a risk management tool, but also perceived it to be expensive.

About 1,200 people from metros like New Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Ahmedabad, Pune and non-metros like Jaipur, Surat, Nagpur, Jalandhar, Chandigarh and other towns across India took this survey last month. Here, 60 per cent of these respondents were home owners, while 40 per cent lived on rented space.

Sasikumar Adidamu, Chief Technical Officer, Non-Motor Insurance, Bajaj Allianz General Insurance, said, "Contrary to the general belief, a home insurance policy is a very affordable financial tool and covers a wide array of risks a home and its contents are exposed to such as fire, theft or burglary, all natural calamities, electrical and mechanical breakdown."

He said that for instance, for a home with a Rs 1 crore cover, you need to pay a premium of only Rs. 5,000 per year.

The survey also showed that 60 per cent of home owners have purchased their home insurance policies from banking and financial institutions as these institutions have offered them loans. The remaining 40 per cent purchased policies from agents and other sources.