Insurance helps ease the pain

Dubai: It is always good to have a back-up plan for anything, but it sure comes in handy when you loose all or even some of your belongings in a fire. That is why one should give home insurance a second thought.

"It is critical to have a home insurance policy as this would protect the insured from accidents and or events that could affect his or her financial health for life. One could lose in seconds what you made in years," Alexis de Beauregard, chief officer of marketing and retail product offering at AXA Insurance Gulf told Gulf News.

"What happens if a fire or water damage spreads from a neighbour's property to yours? Although you are not at fault, your loss needs to be dealt with and home insurance can provide valuable assistance. Also you cannot guarantee your neighbour will have insurance to compensate you" Beauregard added.

There are three kinds of home insurance: for buildings, if you own your own home; for contents, which covers items that you normally leave inside the house, and lastly, for personal possessions, which are normally portable and you could be expected to carry with you if you left the house (think jewellery or camera).

Even if the building is insured, Beauregard said it is still very important to have home insurance, "Tenants often do not consider the legal liability of occupying a building or apartment. For instance, did you ever consider what would happen if the building was damaged by fire and you were found to be legally liable? Not many people could afford to pay the costs of repairing the building — home insurance could step in to cover this."

Shockingly less than 5 per cent of home owners in the UAE have home insurance. Beauregard blamed this is on lack of awareness. "There is very little education on the needs of home insurance and what is included in the insurance policies. A general view among the people is that home insurance is the landlord's responsibility. There is a need to educate the people on this."

Insurance policy prices and services differ from company to company, and from plan to plan. For instance, AXA Gulf's basic home insurance can cover you, your home, and your family for less than Dh1 per day. Other companies charge up to Dh450,000 for contents and Dh75,000 for personal belongings, while others charge a Dh416 annual premium to insure Dh100,000 worth of belongings.