Quick Reply: Your sum insured is not what your flat is worth. Under the Bharat Griha Raksha wordings it is carpet area in square metres multiplied by the rate it would cost to build again today. Household goods ride along at 20 percent of that figure, capped at ₹10 lakh, with nothing to itemise.
Meera Kulkarni paid ₹65 lakh for a two bedroom flat in Nashik and never insured it, because she assumed home insurance was a rich person's product. The example is illustrative, but her first stumble is the common one: she opened the proposal form, saw the words Sum Insured, and typed ₹65 lakh.
That is the wrong number, and it costs money in both directions. It buys premium on land value the policy will never pay for. It is also the mistake that becomes a valuation fight years later, after a fire, over a figure nobody worked out properly at the start.
Meera's sale agreement shows a carpet area of 82 square metres. She also has a balcony of 8 square metres and an open parking slot of 12 square metres. The policy counts balcony, verandah, terrace and parking at 25 percent of their net usable floor area, not at full value.
| What she is insuring | Measured area | Counts as |
|---|---|---|
| Flat, internal partition walls included | 82 sq m | 82 sq m |
| Balcony | 8 sq m | 2 sq m |
| Open parking slot | 12 sq m | 3 sq m |
| Carpet area used for the sum insured | 87 sq m |
She needs one more number: the rate of cost of construction, meaning what a builder would charge today, per square metre, to put up the same structure. She declares ₹20,000.
Buy it for five years and the building sum insured climbs by 10 percent of the base figure each anniversary at no extra premium: ₹19,14,000, then ₹20,88,000, and so on. The escalation stops at 100 percent, so ₹34,80,000 is the ceiling. On an annual policy the same 10 percent is added at one three hundred and sixty fifth per day. This applies to the building cover only, not to contents.
1. It is a construction cost, not a property price. The filed wordings define Cost of Construction as carpet area in square metres multiplied by the rate of cost of construction at the commencement date that you declare and the insurer accepts, plus the construction cost of additional structures. Land, undivided share and resale value are nowhere in that formula.
2. Carpet area has a policy definition. For the main unit it is the net usable floor area, excluding the area under external walls, service shafts, exclusive balcony or verandah and exclusive open terrace, but including the area under internal partition walls. Balcony, verandah, terrace and parking are then added at 25 percent. A builder's brochure figure is usually far larger. Use the sale agreement, sanctioned plan or occupancy certificate.
3. Contents are automatic, so stop counting your spoons. Take both covers and general household contents are insured for 20 percent of the building sum insured, capped at ₹10 lakh, without declaring a single item. If replacing your furniture, appliances and electronics would cost more, declare a higher figure and pay more premium.
| Cover | What it pays | Standard or optional |
|---|---|---|
| Home Building | Repair cost, or the full sum insured on a total loss | Standard, at least one of building or contents must be taken |
| Architect, surveyor, consulting engineer fees | Up to 5 percent of the claim amount | In-built |
| Removing debris from the site | Up to 2 percent of the claim amount | In-built |
| Loss of rent, or rent for alternative accommodation | The amount you declare and the insurer accepts, while the home is unfit to live in, for up to 3 years | In-built, but you must declare the figure |
| General home contents | Repair cost, or an equivalent replacement | Standard, 20 percent in-built |
| Valuable contents such as jewellery, silverware, paintings | Agreed value on a valuation certificate | Optional |
| Personal accident, you and your spouse | ₹5,00,000 per person on death from an insured peril that also damaged the home | Optional |
Insured events run from fire, explosion, lightning and earthquake through storm, cyclone, flood and inundation, subsidence, landslide and rockslide, forest fire, impact damage, riot and strike, acts of terrorism under the attached clause, bursting water tanks and pipes, and sprinkler leakage. Theft within 7 days of one of those events is covered too. Ordinary burglary is not.
Bharat Griha Raksha waives underinsurance. The wordings say it plainly: underinsurance does not apply, so if your sum insured turns out lower than the actual value at risk, the difference will not affect the amount paid. In an ordinary fire policy, insuring a ₹15 lakh building for ₹13.5 lakh means a ₹5 lakh repair bill gets cut proportionately. Here it is paid in full.
That protection has a hard edge, and the edge is where claim disputes are born.
Measure the carpet area accurately. Then pick a construction rate you can justify on paper.
The rate of cost of construction is the input most buyers guess, and a guess is exactly what a surveyor challenges later. There is a public, documented number available for the asking.
State Public Works Departments publish a Schedule of Rates, and municipal corporations often hold construction cost rates used for building permission and property tax. File a short application asking for the current Schedule of Rates or notified construction cost per square metre for residential buildings in your area, and the date it took effect. Ask for the sanctioned building plan or occupancy certificate in the same application, since that fixes your carpet area. Draft it in minutes with the AI RTI Drafter, pay ₹10, and file the reply with your policy.
Track the 30 day clock with the Timeline Tracker. If the reply is silence or a brush off, escalate using the First Appeal Builder, and test any evasive answer with the PIO Reply Checker. The habit of documenting before a dispute runs through The RTI Playbook.
Bharat Griha Raksha was created by IRDAI guidelines dated 4 January 2021, reference IRDA/NL/GDL/MISC/004/01/2021. Every general insurer writing fire business had to offer it from 1 April 2021, on wordings no insurer was permitted to alter.
That founding guideline no longer stands on its own. On 11 June 2024 IRDAI issued the Master Circular on IRDAI Insurance Products Regulations 2024 for General Insurance, reference IRDAI/NL/MSTCIR/MISC/90/06/2024, and its Annexure C repealed the 2021 guidelines by name. The same circular says insurers shall not withdraw or decline to offer any of the erstwhile tariff products in existence before it, and requires every insurer to designate a base retail product in each line of business and display it on its website.
In practice the product is alive. New India Assurance still lists New India Bharat Griha Raksha among its fire products, alongside a newer flexible variant, and the filed wordings under their UINs remain the contract you sign. What has changed is the assumption. Do not walk in believing every insurer is compelled to sell you this exact policy. Ask for it by name and compare it with whatever the insurer has designated as its base home product. The life insurance counterpart is Saral Jeevan Bima, the standard term life policy.
No. If you take both the building and contents covers, general household contents are automatically insured for 20 percent of the building sum insured, capped at ₹10 lakh, with no itemisation. You declare details only if you want a higher contents sum insured, or if you want the optional cover for valuables such as jewellery and paintings.
No. The sum insured is the cost of construction: carpet area multiplied by the rate it would cost to build the structure again today, plus any additional structures. Land is not something the policy can rebuild, so it is not in the formula. Insuring for the purchase price means paying premium on money that will never be paid out.
Underinsurance is waived, so a partial loss is paid in full even if your sum insured was low. On a total loss the sum insured is still the maximum payable, so under-declaring leaves you short. Over-declaring does not help either, because claims are calculated on the actual carpet area, capped at what you declared.
Yes. A tenant, lessee, licensee or employee occupying a home can buy the Home Contents Cover for their own belongings. A tenant liable for insurance under a written agreement can also buy the Home Building Cover. Owner and tenant often split it, one insuring the structure and the other the contents.
One year, or longer, but not more than 10 years. A long term policy is where the automatic escalation earns its keep, because the building sum insured rises by 10 percent of the starting figure every year at no extra premium, up to a maximum increase of 100 percent.
Not under the basic contents cover. Jewellery, silverware, paintings, works of art, antiques and curios fall under Valuable Contents, an optional cover on an agreed value basis that normally needs a valuation certificate. That certificate is waived if the sum insured is up to ₹5 lakh and no single item is worth more than ₹1 lakh.
Up to 5 percent of the claim amount towards architect, surveyor and consulting engineer fees, and up to 2 percent towards clearing debris. It also pays loss of rent, or rent for alternative accommodation, while the home is unfit to live in, for a maximum of 3 years and against a certificate from an architect or the local authority.
Put the arithmetic on paper first: declared carpet area, declared rate, and the source for each. Then follow the escalation route in the home insurance valuation dispute guide, or if the claim was refused outright, the steps for a rejected home insurance claim after fire, flood or theft.