PIA FORUM with DOREEN KAMBANGANJI
UNLIKE motor insurance, home insurance is not mandatory, but, the risk of not having this insurance is there for everyone to see. Yet, we choose not to insure our homes even though, more money and time is invested in a house.
Insurance is the only financial service that takes care of our misfortunes as it is the only financial service which is able to restitute you to your original state and this comes at a very low cost. Of late, we have been hearing of houses being gutted and one is left to wonder if such properties are even insured.
Home insurance cover basically protects us from financial loss when misfortunes like fire and theft hit us. Unfortunately, most of us in Zambia still think that insurance is a luxury and some even go to the extent of avoiding motor insurance even when it is statutory. To know the necessity of insurance, just ask someone who has suffered a loss and has no insurance.
In terms of cost, home insurance is very low; in fact it is even lower than motor insurance and this is because the likelihood of the risk occurring is lower than that of a vehicle. The premium you will pay is very low and is calculated at 0.125 percentage point of the property value + 16 percent value added tax (VAT). So let us assume your house is valued at K650, 000.00, your premiums will be about K942.50 (K812.50+130.00, VAT) per annum. This is a very small amount to part away with compared to what you would lose if you lost your house. Even for a rich person, it only makes economical sense to pay this premium instead of reinvesting huge sums of money in rebuilding.
Investing in a home insurance policy also extends to theft. Imagine a situation where thieves break into your house and take all the important possession like electronics as well as furniture.
With the kind of economic situation that is prevailing today, replacing these items may be a tall order to a majority of the people considering that you have other bills to pay. But when you have a home insurance policy where the stolen stuff is covered, the insurance company is mandated to compensate for the loss. You might not exactly go back to the level where you were before the theft but, the compensation that you get from the insurance company ensures that you continue to enjoy the kind of lifestyle that you had and this is one key unique feature about insurance.
For the person who had not taken a home insurance cover, such a theft will leave a huge financial dent in an attempt to furnish the house in order to enjoy the same kind of lifestyle that prevailed before burglary occurred.Â And in the worst case scenario, one may even be forced to borrow in order to maintain this kind of lifestyle or drop the standards altogether.Â Home insurance does not only give us a peace of mind, but also allows us to continue enjoying the same kind of lifestyle that we had even before misfortune befell us.
Misfortunes can strike at any time, to anyone. No one plans for such and that is why they are called misfortunes. But, we must be financially smart and insure so that we protect ourselves. It is advisable that when these misfortunes occur we should be on the right side, under the insurance cover which will protect us from financial disaster. When you are living in a house which is insured, you have a peace of mind and at the same time confident that in case of any eventuality your financial status will not be affected.
However, you need to know that there are certain things that your home policy will not cover you need to know about these before you buy the policy. Do not forget to read the terms and conditions to avoid disappointments in future.
And remember to shop around and get the right policy. Consult an insurance company or broker for more information.
Your feedback is always welcome.
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PIA FORUM with DOREEN KAMBANGANJI