Hong Kong real estate is notoriously costly. In fact, in 2020, the SAR was declared the world’s most expensive property market. Given the enormous investment required to get some personal space in the city, it should come as no surprise that some people will want to do all possible to protect that investment. This is true not only for the house itself, but also for the personal belongings contained within it.
This is where the many types of insurance available to cover your personal property come into play. In this post, we examine in depth at house insurance, its features, and other important information.
Why Is Having Home Insurance So Important?
If you have a mortgage and your home burns down, you will still owe the bank the full value of your home if you do not have insurance. As a result, mortgages provided for property purchases in Hong Kong include a requirement that the homeowner have home insurance, or they will be in breach of the mortgage terms. Even if you own your home, the monetary and emotional losses that a person might sustain when their property is damaged or invaded can be enormous. For this reason alone, every homeowner should have home insurance.
9 Types Of Home Insurance You Should Know
There is no such thing as a one-size-fits-all house insurance policy. In fact, insurance options for protecting a home will frequently mix a number of different coverages in order to address an owner’s individual worries or the specific hazards that are more likely to be relevant given the property’s location. Here are a few examples:
This is the most basic sort of home insurance, and it covers both the physical structure of your home and the permanent structures within it, such as bathroom fixtures or kitchen cupboards. It can also include coverage for outbuildings like as a garage or shed.
This insurance covers almost everything in your home that isn’t covered by construction insurance. This includes appliances, furniture, and a variety of other goods, including clothing.
When getting contents insurance, notify your insurer of any exceptionally expensive artifacts or collections you own. In the case of rare collectibles and highly valuable objects, the insurance may need specific provisions or documentation.
Personal Liability Insurance
This insurance protects you from any costs that may emerge as a result of a third party injuring themself on your property, whether or not it was your fault. For example, if someone slips, falls, and injures themself on your property, this liability coverage might pay their medical fees as well as the costs of any legal action taken against you.
While the majority of the insurance discussed here is for people’s primary residences, it’s worth mentioning that special insurance policies are available in Hong Kong for those who rent out their property to others. They will have special demands as a result of not living in the property, therefore landlord insurance might be beneficial.
On the other hand, folks who rent a property often do not have to bother about insuring the structure. As a result, they should purchase a customized tenant insurance plan that covers the unique demands of renters.
Although Hong Kong is typically a safe place to reside, break-ins are not unheard of. To secure your valuables and ensure their replacement if stolen, make sure theft coverage is included in your home insurance policy.
Property Repair Insurance
This sort of insurance mostly covers the costs of fixing appliances in your home if they break down.
Fire insurance is usually included in home insurance policies since it will assist in the reconstruction of your home and will either replace or pay you for your valuables if all or a portion of your property is damaged or destroyed by fire.
Natural Disasters Insurance
Other disasters that could occur and harm your property include the following. Typhoons, earthquakes, floods, broken pipes, explosions, and landslides are examples of natural disasters.
It’s a good idea to mention all of these, however some specific catastrophes, such as typhoons, are more relevant to Hong Kong than earthquakes.
The environment around your home may also influence which disasters pose the biggest risk to your property. A home at the base of a mountain, for example, should get flood and landslide insurance.
There are a lot of lesser elements to be aware of in addition to the main sorts of plans themselves. To begin, other coverages that are often included in home insurance plans, often at no extra cost, are as follows:
- Personal accident insurance
- Removal of debris
- Architect and surveyor fees
- Lock replacement after a break-in
- Coverage for a computer
- Cover for frozen food
- Coverage for your domestic assistants’ personal belongings
Some home insurance policies reimburse rental costs if the home is damaged and become uninhabitable. There are additional incentives available for damage sustained during a transfer. Your home insurance policy should be “new for old.” This means that if your property is damaged and needs to be replaced, you will receive a new version of the item rather than a used one of equivalent age, wear, and tear.
Furthermore, house insurance policies may cover reimbursements for lost income due to hospitalization as a result of a home accident. These plans may also offer lump-sum compensation for home-related deaths.
In some circumstances, house insurance might even extend outside the home. There are benefits for personal property damage, theft, or loss at work. It may even safeguard your belongings, money, and/or credit card transactions while traveling abroad for work.
Furthermore, home insurance policies might include 24-hour home assistance, which can be utilized to acquire recommendations for experts such as electricians, plumbers, contractors, handymen, nurses, babysitters, exterminators, cleaners, and others.
Keep this in mind while purchasing Hong Kong property insurance.
The premiums for a house insurance policy will be calculated by the estimated worth and contents of your home. Some home insurance policies only cover a person’s principal dwelling. In rare situations, the management corporations of Hong Kong apartment buildings will provide policies to all of their inhabitants. In this case, your insurance premiums are frequently included in your management fee.
Many home insurance policies require the insured and their family to take reasonable precautions to prevent damage or loss of their property, maintain their property, and comply with any rules or statutes that apply to their property. Failure to do so may result in the policy being voided or claims being denied. Remember that, like other types of insurance, house insurance may require you to pay a fee each time you file a claim. This can be a fixed excess or a percentage of the stated value.
Another noteworthy aspect of Hong Kong home insurance is that buildings that are lower to the ground, such as village cottages, are frequently subjected to additional examination by insurers. This could result in higher premiums for such buildings’ coverage, and some policies will outright exclude coverage for such residences. To top it all off, there are other typical exclusions that might result in your house insurance claim being denied. Among these include, but are not limited to:
- General deterioration, including rust or corrosion, rot, dampness, mold, mildew, or market depreciation
- Theft of convenience as a result of the homeowner’s negligence.
- Fines levied by the government
- Accidents or injuries caused by purposeful malice, aggression, irresponsibility, or vandalism by the homeowner
- Loss of Property as a result of negligence on the part of the homeowner
- Failure of household equipment or gadgets due to mechanical failure
Having said that, one or more of the aforementioned exclusions may be covered by a specific policy. Check your policy papers and confirm with your insurance provider or broker to ensure that exclusions are clearly outlined.