The crime rate is increasing and getting your house or your office burgled leads to enormous loss. After the money that you spend in acquiring the assets for your home or your business, if the assets are stolen, you face a considerable financial loss. In fact, after a burglary, you might find it difficult to replace the items that you lost to theft. To cover the financial loss suffered due to burglary and theft, burglary insurance policies are available in the market. Let’s explore what a burglary insurance policy entails –

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What is burglary insurance?

Burglary insurance is an insurance policy which covers the financial loss that you suffer in case of a burglary or attempted burglary into your home or business premises. Burglary is defined as an act of forceful entry into the house or business premises with an illegal intention of theft.

 

Features of burglary insurance

Burglary insurance policies have the following salient features –

• They can be bought by homeowners, tenants as well as business organisations to cover the financial loss suffered due to burglary

• A burglary insurance policy can also cover theft and robbery. That is why the plans are also called burglary and theft insurance plans

• There are different types of burglary insurance plans available in the market

• You can avail different types of burglary insurance policies for covering different types of assets which are exposed to the risk of theft

• A standard burglary insurance policy can be extended to cover losses suffered due to burglaries committed during riots, strikes, fire, etc.

 

What is covered under burglary insurance?

Burglary insurance covers the following losses which you might face in case of a burglary or attempted burglary –

• Damage to the home or business premises due to forceful and unlawful entry

• Loss of assets or property due to theft and burglary

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Coverage under burglary insurance policies can be taken for the following types of assets –

• Cash and valuables

• Home appliances

• Electronic gadgets

• Money in transit

• Cash stored in safe

• Stock in trade

• Business assets

• Plants and equipment used in the factory or business premises

• Jewellery, etc.

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What is not covered under burglary insurance?

Burglary insurance policies have the below-mentioned exclusions in which case the claims are not paid –

• Loss or damage which occurs due to war, strikes, riots, etc. unless otherwise specified

• Losses due to natural calamities

• Losses suffered when the property is under renovation

• Losses due to nuclear threats or contamination

• Loss of property because it was confiscated by the Government

• Consequential losses

• If the family members are involved in the burglary, claims would not be covered

• Precious metals and cash might be excluded unless specifically covered under the plan

• Theft or burglary of share certificates, promissory bonds, treasury bills, etc. are not covered

• Theft by employees or housemaids are not covered

• Burglary or theft when the premises were left unattended or when the premise was not completely locked

• Fraudulent claims are not covered

• Theft using a duplicate key is not covered unless the key was acquired forcefully

• Burglary, when proper security was not maintained, would not be covered

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Types of burglary insurance policies

Burglary insurance policies can be of different types based on the type of coverage as well as the assets that they cover. Here are some of the commonly found burglary insurance policies in Europe–

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Stock Declaration Policy

This policy is for businesses which cannot estimate the exact value of their stock in trade. In such cases, the highest possible value of the stock is taken to be the sum insured so that the losses can be sufficiently covered.

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First Loss Policy

Under this policy, a portion of the stock is insured which is likely to be burgled. This type of policy is relevant when the total loss cannot be plausibly estimated.

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Full Value Policy

This policy covers the asset for its full value so that in case of loss the full value can be claimed.

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Money in Transit Insurance

This policy covers the risk of theft or burglary on an amount of money which is in transit. The policy is relevant for businesses where the movement of physical cash is involved.

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Business Premises Insurance

This policy covers the risk of burglary and theft in the place of business.

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Dwelling Insurance

Under this policy, your residential house is covered against burglary and theft.

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Jewellery and Valuable Policy

This policy specifically covers precious jewellery, valuable, works of art and other valuables against burglary.

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Cash in Safe Policy

This burglary insurance policy covers the risk of theft of the cash which is kept in a safe at the house or at the business premises.

Burglary v/s robbery v/s theft

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While the terms ‘burglary’, ‘robbery’ and ‘theft’ are used interchangeably, their meanings are quite different from one another. Here’s how –

1. Burglary is when there is an unlawful and forceful entry into your premises. You might or might not be present on the premises when the burglary occurs

2. 2.Robbery is an unlawful and forceful entry into your premises when you are present on the premises. Your presence is important for the act to be considered a robbery in the eyes of the law

3. Theft involves non-violent and forceful entry into the premises

Some insurance policies can cover the only burglary while others can also cover theft and/or robbery. So, you should know how these terms differ from one another and check whether the policy allows coverage for all three terms or for some of them.

Premiums of burglary insurance policies

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The premiums of burglary insurance plans depend on the asset covered, its value and the expected risks. You can, however, reduce the premiums through the following ways –

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• By installing safety devices in your house or business premises which would alert you to any unlawful activity

• By installing CCTV cameras which would help in preventing or lowering the risk of burglary

• By fencing the premises which are being insured

• By installing security alarms which would lower the extent of loss, etc.

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Things to remember when buying burglary insurance

You can buy a burglary insurance policy online by making an online application to the insurance company which is offering the cover. Before buying the policy, however, the following should be kept in mind –

1. Ensure that all possible assets which face a risk of theft are covered under the burglary insurance policy

2. Compare the available policies before buying

3. Check whether the policy covers only burglary, theft or both

4. The sum insured should be sufficient enough to cover the loss that you suffer. If the sum insured is inadequate, the claim would be settled on a proportionate basis even if the loss is covered under the sum insured. For instance, if the value of an asset is USD $ 10,000 but you insure it for USD $ 4,000, if there is a loss of USD $ 6,000, the claim would be paid for  USD $8,000

5. The premium of burglary insurance policy can be reduced. Use the available ways to reduce the premium so that the policy becomes affordable

 

Making a claim under burglary insurance

If a burglary happens and you face a claim, here are the steps which you should take to raise the claim and get it settled –

1. Inform the insurance company immediately of the burglary

2. Take pictures of the loss which you have suffered. These pictures would serve as proof to help the insurance company estimate the extent of loss

3. Record all the losses which you have suffered so that they can be mentioned on the claim form

4. The receipts of repairs and replacement of the burgled items should be kept securely

5. Record everything that happens after the burglary has occurred so that you give documentary evidence to the insurance company if required

A burglary insurance policy proves to be a valuable addition to your insurance portfolio as the policy compensates you for the financial loss that you suffer in case of burglaries. So, insure your home or your office under a burglary insurance policy and be financially secured against unlawful activities.

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Frequently Asked Questions

1. What is the meaning of policy extensions?

   Policy extensions are additional coverage options which you can choose by paying an additional premium. These extensions increase the scope of coverage of the policy.

2. Does burglary insurance offer any policy extensions?

   Yes, burglary insurance plans offer policy extensions which allow you coverage against losses that you face due to riots, strikes, rebellion, etc.

3. I was on holiday for 10 days and my house was burgled. Would the burglary insurance policy cover this loss?

       No, burglaries occurring when the house is left unattended for more than 7 days are not covered.