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Insurable Risks for buildings in Sri Lanka

It looks as if you can't switch on a TV without coming across an advertisement relating to leasing or insurance at the moment in Sri Lanka. However, it’s not a surprise. The businesses always try to persuade the customers saying that their deal is the best. Useful way for consumers to track down the best price for everything from car insurance to loans is to visit a price comparison website such as
But the bargain-basement premiums identified by top companies might not always offer the best value. Buying a policy due to its cheapness could trigger a nasty surprise when making a claim. For home insurance in particular, experts flag up the importance of buying policies according to individual needs. Since properties will have different values, comparison sites are a good starting point if you like to get the best deal.

Insurable Risks relating to buildings
This covers the actual structure of a home, plus permanent fixtures and fittings. Most homeowners will have to buy buildings insurance as a condition of taking out a mortgage or a housing loan. Policies can be bolstered to include outside buildings such as sheds, garages and standalone conservatories as well.

When applying for cover, be aware that the level needed to insure should be based on the cost of re-building, not the market value of the building. The re-building cost takes into account the availability of building materials, labour charges and location of the home etc. If that's not easy, consider asking a local chartered surveyor. Most insurers will also provide a guide.

Evaluation of flood history
Insiders in the insurance industry flag up a range of features which might be missing from no-frills deals. These include a limit on rebuilding costs, and whether cover is included for accidental damage to things such as kitchen and bathroom fittings.
Bargain policies might not include alternative accommodation costs if the house becomes uninhabitable because of, for example, a major flood or fire, or cover the cost of curing a leak. Less generous insurers will pay out for the cost of damage caused by a leak, but not the expense of finding and fixing it.

Flooding risk can also be an area of contention. If you are looking to buy a new home, carefully check flood history in the area. If there is a local history - even if the house you are buying has never been affected - some insurers may decline cover or significantly increase excesses for flooding.

Contents cover
Contents cover - the other kind of home insurance - protects everything inside a property, from art to the washing machine. There's no short cut to working out the level of contents cover you need. Homeowners need to work out the cost of replacing items as new, which will clearly vary from property to property. Some insurers do room-only policies, which insure based on what they believe to be the typical value of, say, a two-bed semi. But though laborious it's a better idea to go from room to room and assess what it would cost to replace the contents if damaged beyond repair.

The cheapest premiums will probably have the highest excess - the first portion of every claim which has to be paid - so homeowners have to decide between the trade-off of a cheaper premium for potentially higher claim costs. But note that particularly valuable items might need to be insured separately. Many policies have a single item limit or insurers limit their pay-out to no more than a third of the overall sum insured.

Avoid being taken for a ride
As with buildings insurance, check the terms and conditions to avoid any insurers' loopholes. Some policies include accidental damage cover for non-portable items such as TVs and gas fires, as well as insuring misuse of lost credit cards, and legal expenses cover.

Some insurers will pay out for locksmith services if a home is burgled but others will not. Home-workers might have to tell their insurer that they work at the property - especially if it involves client visits - in order to avoid claims being turned down.
It is often worth buying accidental damage which covers you for red wine on carpets or a foot through the ceiling It is also worth buying cover for your personal property away from the home - but check whether this cover is worldwide or Sri Lanka only.

Find out what is covered in your garage or shed. This can vary from nothing to generous allowances. If you're buying both contents and buildings insurance, note that it's usually cheaper to buy a combined policy. But check before buying. Compare the deals here.

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