Your “Apna Ghar”: The Ultimate Guide to Home Insurance in India

Let’s be honest reading an home insurance policy feels a bit like reading a microwave manual in a different language. It’s dense, boring, and full of “what-ifs.” In India, we put our life savings into building a home. Yet, while we wouldn’t dream of driving a car without insurance, nearly 70% of Indian homes are uninsured. I hear the same thing every day: “Sir, it’s too complicated” or “It’s too expensive.” Actually, home insurance in India is one of the cheapest in the world—often costing less than a single family dinner at a restaurant.

Most people think home insurance is just one thing. It’s actually a “bundle” of four specific types of protection:

• Dwelling Coverage: This is the big one. It pays to rebuild your house (walls, roof, floors) if it’s destroyed by fire, wind, or lightning. Insure your home for what it costs to rebuild, not what you paid for it. Real estate market value and construction costs are two very different numbers!
• Personal Property: This covers your “stuff”—clothes, furniture, electronics, and even that fancy air fryer. Even if your stuff is stolen while you’re on vacation, this usually covers it.
• Liability Protection: If a guest slips on a rug or your dog nips the mailman, this covers your legal fees and medical bills. It protects your life savings from a lawsuit.
• Loss of Use: If a kitchen fire makes your house unlivable, this pays for your hotel stays and takeout pizza while the repairs happen.

In 2026, the average construction cost for a standard home in India ranges from ₹1,800 to ₹2,800 per sq. ft. (depending on your city).

{Carpet Area (sq. ft.)}X{Construction Cost per sq. ft.} = {Sum Insured}

• Example: You have a 1,200 sq. ft. flat in a city like Mumbai or Bangalore
• Math: ₹1,200 X ₹2,200 = ₹26,40,000
• The Lesson: Even if your flat’s market value is ₹1 Crore, you only insure it for ₹26.4 Lakhs. Why? Because the land doesn’t burn down!

Step 2: The Premium Estimate

Home insurance is incredibly affordable. For the ₹26.4 Lakhs cover mentioned above, your annual premium would likely be:

• Approx. ₹1,200 to ₹1,800 per YEAR.
• That’s roughly ₹150 a month—less than a OTT subscription.

Note on GST: While GST on Life and Health insurance was recently reduced to 0%, Home Insurance still attracts 18% GST. Always check the “final payable” amount.

3. Three “Pro-Tips” for Indian Homeowners

• Tenant vs. Owner: If you are a tenant, you don’t need to insure the building. You only need a “Contents Only” policy to protect your furniture, electronics, and clothes.
• The Jewelry Trap: Standard home insurance has a very low limit for gold and jewelry (often capped at ₹50,000 or 1% of the sum). If you keep gold at home, you must buy a Jewelry Add-on.
• First-Loss Cover: If you are worried about theft, ask for “First Loss” coverage. It allows you to insure your contents for a percentage of the total value, which lowers your premium even further.

4. What is NOT covered?

• Old Age: Cracks due to “wear and tear” or a leaky pipe that you ignored for months.
• Cash: Physical cash or currency kept in a cupboard is almost never covered.
• Willful Act: If you set the fire yourself (obviously!).