This article is part of our complete guide to insurance in India. For most families the home is the largest thing they own, yet very few Indian homes are insured. Home insurance is cheap, standardised and easy to buy. This guide explains the standard policy, what it leaves out, and how to set the cover so a claim is paid in full.
The Short Answer
Home insurance in India is built on Bharat Griha Raksha, a standard policy that IRDAI has required every general insurer to offer since 1 April 2021. It covers the building and its contents against fire, natural disasters such as flood, storm and earthquake, riots, and similar events, on the same terms at every insurer.
The cover is set on the cost of rebuilding, not the market price, because land does not burn or wash away. Underinsurance is waived, the building sum insured rises automatically, and contents get an automatic cover when you insure the building. Ordinary burglary is not included in the base cover, and is added separately.
You insure the house, not the land. The question is what it would cost to rebuild, not what it would sell for.
The Standard Policy
What Bharat Griha Raksha covers
| Feature | How it works |
|---|---|
| Building | The structure, fittings and fixtures, garage, compound wall, gates and water tanks |
| Sum insured for the building | Cost of construction: carpet area × construction rate, plus additional structures. Land is excluded |
| General contents | Automatically covered at 20% of the building sum insured, up to ₹10 lakh, when you insure the building; you can declare more |
| Valuables | Jewellery, silver, art and antiques only as an optional cover, on an agreed value |
| Underinsurance | Waived: a claim is not cut because the declared value was too low |
| Automatic increase | The building sum insured rises by 10% a year (on long-term policies, up to a cap) at no extra premium |
| Rent | Loss of rent, and rent for alternative accommodation while the home is uninhabitable after an insured event |
| Policy term | One year, or long-term up to 10 years |
Events covered
- Fire, lightning, explosion
- Storm, cyclone, flood, inundation, earthquake, landslide and subsidence
- Riot, strike, malicious damage and terrorism
- Impact damage, bursting or overflow of water tanks and pipes
- Theft, but only within seven days of one of the events above
The Gaps
What the standard policy leaves out
- Ordinary burglary. Theft is covered only within seven days of an insured event. For everyday burglary, add a burglary cover or buy a home package policy.
- Breakdown of appliances. Electrical or mechanical failure of a machine is not covered unless caused by an insured event.
- Jewellery and valuables unless you add the valuables cover.
- Wear and tear, deliberate damage, war and nuclear risks.
- Additions not declared, such as a new floor that increases the carpet area by more than 10%.
Setting The Cover
How to set the sum insured
For the building, multiply the carpet area by a realistic current construction rate for your city and quality of finish, and add boundary walls and other structures. Do not use the market price, which includes land. For a flat, insure the interior and your share of the structure, and check whether the housing society already insures the building.
For contents, the automatic 20% (up to ₹10 lakh) is enough for many homes. Declare a higher amount if your furniture, electronics and appliances are worth more, and insure jewellery separately on an agreed value.
The one rule that matters most: insure the cost of rebuilding, and keep a record of what you own. Photograph each room, keep major bills, and store the copies in the cloud. After a fire or flood, proof of what was lost is what turns a claim into a payment.
Who Should Buy
Owners, tenants and home-loan borrowers
- Owners should insure both building and contents.
- Tenants can insure their contents, and the building too if the rental agreement makes them responsible for it.
- Home-loan borrowers: lenders usually require the building to be insured. You may buy the policy from any insurer; check that the cover is adequate rather than accepting whatever is bundled with the loan.
- Flood- and earthquake-prone areas: the standard policy already covers these perils, which makes it particularly valuable there.
When Something Happens
Making a claim
- Inform the insurer as soon as possible, and the police for riot, malicious damage or theft.
- Take photographs and video before cleaning up, and prevent further damage.
- Keep damaged items for the surveyor.
- Submit the claim form, photographs, bills or estimates, and the police report where relevant.
Avoid These
Common home insurance mistakes
1. Insuring at market value
You pay premium on land that cannot be damaged. Insure the rebuild cost.
2. Assuming burglary is covered
It is not, except within seven days of an insured event. Add it if you need it.
3. Forgetting jewellery
Valuables are covered only under the optional valuables cover, on an agreed value.
4. Not updating after renovation
A major addition increases the rebuild cost. Declare it so the cover keeps pace.
Key takeaways
→ Bharat Griha Raksha is the standard home policy every general insurer must offer, covering building and contents against fire, natural disasters, riots and similar events.
→ Insure the building at the cost of rebuilding, not the market price; land is excluded.
→ Contents are automatically covered at 20% of the building sum insured, up to ₹10 lakh; declare more if needed, and insure jewellery separately.
→ Underinsurance is waived and the building cover rises automatically, but ordinary burglary is not included.
→ Keep photographs and bills of what you own: proof is what makes a claim pay.
Questions
Frequently asked questions
What is Bharat Griha Raksha?
A standard home insurance policy that IRDAI has required every general insurer to offer since 1 April 2021, covering the building and contents against fire, natural calamities, riots and similar events on uniform terms.
Does home insurance cover theft?
The standard policy covers theft only within seven days of an insured event such as a fire or flood. For ordinary burglary, add a burglary cover or buy a home package policy.
How much home insurance do I need?
For the building, the cost of reconstruction: carpet area multiplied by a current construction rate, plus other structures. Not the market value, which includes land.
Can tenants buy home insurance?
Yes. Tenants can insure their contents, and the building too if the rental agreement makes them responsible for insuring it.
Are earthquakes and floods covered?
Yes. The standard policy covers earthquake, flood, storm, cyclone and landslide among its listed perils.
Can I buy home insurance for more than one year?
Yes. Bharat Griha Raksha can be bought for up to 10 years, with the building sum insured increasing automatically.
Keep Learning
Next steps: Motor insurance · Personal accident insurance · Shop and MSME insurance
The bigger picture: The complete guide to insurance in India
About the author
Ujjwal Tiwary
ARN-144500 · NISM Series V-A certified since 2018 · Ranchi & Deoghar, Jharkhand
Ujjwal Tiwary is an AMFI-registered mutual fund distributor (ARN-144500) based in Ranchi and Deoghar, Jharkhand, and has held the NISM Series V-A certification since 2018. He works with families on mutual funds, insurance and income tax returns, and writes or personally reviews every article on FactFinances. He is not a SEBI-registered investment adviser; nothing on this site is personalised advice.
Disclaimer: FactFinances provides educational content only. This article is for general information and is not insurance, tax, financial or legal advice, and does not recommend any specific product or insurer. Insurance is the subject matter of solicitation. Features described are those of the standard Bharat Griha Raksha policy as published by insurers, as understood at the time of writing; add-ons, limits and package policies vary between insurers, and the policy wording governs. ARN-144500. Regulatory information: IRDAI.