Home Insurance Guide: Coverage for Property Damage due to Burglary, Renovation, and Water Seepage in Ceilings

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Typhoon Mangkhut in 2018 caused significant loss of household property in many homes and highlighted the importance of having home insurance in Hong Kong. What is home insurance? Although often used interchangeably with “fire insurance”, the two are different. Home insurance mainly offers coverage for household property and personal effects, as well as, third-party liability protection whereas fire insurance insures against the structure of the building, like the exterior walls, roofs, rooftop windows and gates. There are many unforeseen circumstances like forcefully pried door locks, burglaries, water seepage in ceilings, broken windows due to strong wind which lead to the loss of household property. In those situations, home insurance can be tremendously helpful in alleviating the financial losses incurred. The following guide from MoneyHero.com.hk will compare various home insurance plans on the market, as well as, provide an overview of the claims procedure so you are equipped with the necessary knowledge to confidently choose coverage that suits you.


 


Friendly reminder: Home Insurance

After investing millions in a comfortable home, why not spend a few hundred dollars more on a home insurance policy to provide full coverage for your residence? Home insurance will provide financial protection from a range of incidents such as the need to replace pried door locks, house burglary or water seepage causing property damage. A one-stop platform like MoneyHero.com.hk offers convenient comparisons of different plans from top insurers, as well as, an online purchase option where your insurance plan will take effect immediately. For a limited time, you can also enjoy a 20% discount so you can protect your belongings for an annual fee as low as HKD$420 only!


Coverage of Home Insurance

 

1/ Damage to Door Locks/Loss of Household Property Due to Burglary

In the unfortunate event you find your doors and/or windows pried open and personal effects missing, home insurance will be a great help in compensating for any loss in personal belongings and repair costs of getting new locks. The maximum compensation amount ranges from HK$300,000 to HK$1,500,000.

In the event of burglary, the insured person must call the police and notify the management office as soon as the burglary is detected to open an investigation. Once you have filed a report with the management office or police, take pictures – the more meticulous the better – of any signs of burglary. Pried open doors and windows are considered as traces of burglary. After that, make a list of missing items and submit your list to the insurance company. If possible, attach receipts for each item.

When door locks are being repaired, it is important to ask the locksmith for a bill or a repair receipt and submit that as a claim to the insurance company. Some insurance companies have a policy called “deductibles”. The deductible is also commonly known as “excess fee”. Part of the amount is required to be paid by the insured and the amount varies between insurers. Therefore, do pay attention to deductible related terms and conditions when evaluating suitable coverage for your needs.

In situations where the insured is injured during a burglary, some home insurance plans may reimburse for the cost of medical treatment, although this is again, different from provider to provider.  For example, in the case of Allied World’s ‘HomeGuard Occupier Cover – Plan II’, the maximum annual compensation is HK$1,000,000 and the compensation for each item is HK$ $60,000 with a deductible of HK$500/time. If the total loss of your household property is HK$80,000, your compensation will be HK$79,500. If you lose valuables (such as jewelry, antiques and art), the maximum annual compensation is HK$200,000 and the compensation for each item is HK$12,000. In addition, Allied World also reimburses you for medical expenses incurred as a result of burglary. The maximum compensation is HK$5,000/year.

Recommended claims procedure to enable a smooth process as follows:

  1. File a police report within 24 hours and obtain an investigation report,
  2. Take images of all traces of burglary, especially if the door locks or windows were forced open, or any other evidence, such as photos of damaged objects,
  3. Record lost property, make a list and attach purchase receipts, if possible,
  4. When repairing the locks, ask the locksmith for a bill or repair receipt,
  5. Medical certificate issued by a registered doctor (if needed)
Home Insurance – Loss of Household Property Due to Burglary*
Insurance Company Insurance Plan Household Contents Protection
(Maximum Annual Compensation)
Personal Valuable Protection
(Maximum Annual Compensation)
Changing Door Locks/Windows
(Maximum Annual Compensation)
Medical Expenses
(Maximum Compensation)
Allied World HomeGuard Occupier Cover  Plan II HK$1,000,000
Household Contents:HK$60,000/article
Personal Valuables:HK$200,000
HK$12,000/article
Deductibles:HK$500/time
HK$5,000 HK$5,000/year
AXA SmartHome Optimum HK$750,000
Household Contents:HK$75,000/item
Personal Valuables:HK$25,000/year
HK$15,000/item
 HK$3,000  X
Chubb MyHomeGuard Plan C HK$1,000,000
Household Contents:HK$10,000/item/set
Personal Valuables:
HK$10,000/item/set
 HK$150,000 X
Dah Sing HomeSure Household Insurance  Plan C HK$1,200,000
HK$120,000/item/set
Deductibles:HK$250/time and HK$500
(Laptops)
HK$300,000
HK$30,000/item/set
HK$4,000  X
FWD Easy HomeCare HK$500,000
Household Contents:HK$$100,000/item
Personal Valuables:HK$10,000/item
Deductibles:HK$500/time
 HK$3,000  X
Prudential PRUchoice Home  Premier Plan HK$1,500,000
Household Contents: HK$100,000/item
Personal Valuables: HK$200,000
HK$20,000/item
Deductibles:HK$250
HK$2,000 HK$5,000/year
Zurich HomeChoice Insurance Plan  Householder Insurance HK$750,000
HK$100,000/set
HK$250,000
HK$20,00/set
HK$750,000
HK$5,000/time
HK$500/2 times

*The above table is based on coverage for home size of 500 square feet or less.

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2/ Water Seepage in Your / Downstairs Unit Ceilings

Water seepage in ceilings is a problem that has occurred in every household. We will mainly divide it into two situations:

1/ If there is water seepage in your ceiling causing loss of household property, you will need “Household Goods Insurance”.
2/ If the occupants downstairs experience water seepage in their ceilings that you might have to compensate, your coverage need will extend to “personal liability protection”

When you encounter the above situations, the biggest advantage of having home insurance is the assistance your insurance company provides in managing all communications directly with your neighbors, thereby saving you hassle and avoiding lengthy negotiations. Furthermore, home insurance will also compensate you for all related losses. We will describe the two situations separately.

1/ Water Seepage in Your Ceilings:

When you find traces of water seepage in your ceilings, the source is usually the unit above you. The process to negotiate reparation work with the occupant may not necessarily be smooth. In that situation, you should take clear and detailed photos of the affected areas in your unit. Report the matter to the management office of your residence and your insurance company as soon as possible so they can act as the mediator between you and the other party in question. You must request the investigation report from the management office and submit it to the insurance company. When you are looking for a handyman to repair your ceiling, remember to ask for a receipt or quotation for the repair so you can make a claim against the insurance company.

Claims procedure:

  1. Notify the building management office and obtain an investigation report as it must be submitted to the insurance company,
  2. Take photos of the water seepage, the more meticulous the better,
  3. Inform your insurance company to negotiate directly with the residents upstairs so you do not have to,
  4. Receipt or quotations for repair work must be retained to facilitate claims submission.

2/Water Seepage in the Ceilings of the Unit Downstairs  

When water seepage occurs in the unit downstairs, it is usually due to a problem in your bathroom(s). When faced with a claim, remember to not suggest an offer to compensate for any damages just yet. You should first contact your insurer and the management office as they will negotiate on your behalf. During the process, the management office and insurance company will investigate cause of and responsibility for the leak. There is a possibility that you are not at fault and other factors may have caused the problem.

However, if it is eventually found that the responsibility belongs to you, the insurance company will protect your financial responsibility. This is where “personal responsibility protection” in a home insurance policy comes into play as it is meant to protect the insured person from inadvertently causing physical injury or damage to a third party. Take Allied World “HomeGuard Occupier Cover – Plan II” for example, the maximum compensation for personal liability protection is HK$10,000,000 / year.

Claims procedure:

  1. Notify the management office and obtain an investigation report,
  2. Inform the insurance company to negotiate directly with the occupants downstairs so you can remain removed from the process,
  3. Do not assume any liability before final results of the investigation are released.
Home Insurance – Personal Liability Protection*
Insurance Company Insurance Plan Personal Liability Protection Deductibles
Allied World HomeGuard Occupier Cover Plan II HK$10,000,000  X
AXA  SmartHome Optimum  HK$5,000,000  X**
Chubb MyHomeGuard Plan C  HK$5,000,000   ✓^
Dah Sing HomeSure Household Insurance Plan C  HK$12,000,000  X
FWD Easy HomeCare HK$5,000,000  HK$500
Prudential PRUchoice Home  Premier Plan  HK$$15,000,000   X 
Zurich HomeChoice Insurance Plan Householder Insurance  HK$10,000,000    X 

 

*The above is compared with a unit of 500 square feet or less
**Only suitable where building age is 25 years or less

^Has a deductible of HK$1,500 or 10% of adjusted loss, whichever is greater. For example, if the assessed loss is determined to be HK$80,000, the insured person will have to pay a deductible of HK1,500 or HK$80,000X10%=HK$8,000,The latter is higher, therefore insured person will receive a compensation of HK$80,000-HK$8,000=HK$72,000.

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3/ Property Damage Due to Renovation Work:

If the insured’s home is damaged during what qualifies as a “Home Renovation Period” or “Building Renovation Works”, the insurance company will compensate you for the loss. However, in general, some insurance companies have restrictions on the renovation period and total renovation costs. For example, the renovation period cannot exceed 2-3 months, and the total renovation fee cannot exceed HK$100,000-HK$300,000. Some companies also impose a deductible so it is worthwhile to get acquainted with the relevant terms and conditions.

For example, in the case of Dah Sing Insurance “HomeSure – Plan C”, any damage to the insured home during the renovation period will be eligible for compensation of up to a maximum of HK$1,200,000/year, HK$10,000/piece/group, not exceeding 2 months of renovation and the total renovation cost does not exceed HK$100,000.

Home Insurance – Property Damage Due to Home Renovation*
Insurance Company Insurance Plan Maximum Annual Compensation Home Renovation Period
 Total Renovation Fee Deductibles
Allied World HomeGuard Occupier Cover Plan II HK$200,000  /  HK$100,000 X
AXA SmartHome Optimum HK$750,000
Household Contents:HK$75,000/item
Personal Valuables:HK$250,000/year
HK$15,000/item
 /  / X**
Chubb MyHomeGuard  Plan C  HK$150,000/year   /    /    ✓^
Dah Sing HomeSure Household Insurance  Plan C  

HK$1,200,000/year
HK$10,000/item/set

Less than 2 months HK$100,000 HK$250
(Indoor Home Contents)
HK$500
(Laptops) HK$2000
(Outdoor Home Contents)
FWD Easy HomeCare HK$100,000 /year Less than 2 months  /  HK$500
Prudential PRUchoice Home  Premier Plan HK$$300,000/year Less than 60 days  HK$300,000 X
Zurich HomeChoice Insurance Plan Householder Insurance HK$750,000/year
HK$100,000/time
Less than 2 months   /  X

*The above is compared with a unit of 500 square feet or less.
**Only suitable where building age is 25 years or less

^Chubb MyHomeGuard Plan C has a deductible, HK$7,000 or 10% of adjusted loss, whichever is greater. For example, if the assessed loss is determined to be HK$80,000, the insured person will have to pay a deductible of either HK7,000 or HK$80,000X10%=HK$8,000. The latter is higher, therefore insured person will receive a compensation of HK$80,000-HK$8,000=HK$72,000.

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4/ 24 Hour Emergency Home Assistance Services

Many people have experienced the need for emergency unlocking services. Imagine rushing back home after a long day of work only to find that you do not have your keys. Your whole family is traveling overseas and you are the only one left in Hong Kong. No one is there to open the door for you. You need to find a locksmith to solve the bind you are in! That’s when home insurance coverage with  “24-Hour Emergency Home Assistance Services” such as the Zurich HomeChoice Insurance Plan – Household Insurance can be incredibly helpful. Services are rendered free of charge during standard hours of 9:00am-9:00pm from Monday to Sunday, except for public holidays. An out-of-pocket surcharge is incurred for non-standard hours. Note that some insurance companies only provide referral services, and the unlocking fee is considered as your own expense. In any case, you are not left frantically searching for a reliable locksmith which is a huge relief.

Home Insurance – 24 Hour Emergency Home Assistance Services
Insurance Company Insurance Plan 24 Hour Emergency Home Assistance Services
24 Hour Emergency Hotline
Allied World HomeGuard Occupier Cover Plan II Referral Services:Electrical assistance/plumbing assistance, house call /dental referral, baby-sitting, nursing assistance, hotel room accommodation referral and locksmith assistance +852 2851 2666
AXA SmartHome Optimum Referral Services:Electrician, plumber, locksmith, house call/dental, baby-sitting/home nursing and pest  control/cleaning services +852 28511990
Chubb MyHomeGuard  Plan C  / /
Dah Sing HomeSure Household Insurance  Plan C Referral Services:Locksmith, pest control, electrical, home cleaning services, plumbing, and baby-sitting, etc. +852 8206 2229
FWD Easy HomeCare /  /
Prudential PRUchoice Home Premier Plan Referral Services: Locksmith, plumbing, electrical, house call, dental, baby-sitting, nursing, pest control and household cleaning. +852  2862 0112
Zurich HomeChoice Insurance Plan Householder Insurance Hassle-free cashless approach for plumbing, electrical or locksmith assistance
Referral Services: Household cleaning, house call, dental, baby-sitting, nursing, and pest control.
  +852 2886 3977

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Read more: Tips for buying home insurance in Hong Kong, how to choose the best coverage for your home?

 

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