Multi-Risk Insurance

Under a single contract a party is insured for series of relevant risks. Due to its importance, multi-risk home insurance stands out, but there are many others, such as multi-risk insurance for commerce, industry, and so on.

Multi-Risk Home Insurance

The purpose of this insurance is to protect the insured party from losses or damages that may arise from accidents in a private home.

The guarantees that are usually established in a home insurance policy are the following:

1. Material damage

Material damage affects a person’s goods or assets. This coverage indemnifies any losses suffered related to the structure of the building and the contents insured in the policy.

1. Structure of the building: the whole or part of the building used as a dwelling.That is to say, the set of main and/or accessory constructions, including foundations and fixed facilities. Also false ceilings, wallpaper, paint, wood and carpets adhered to floors, walls or ceilings, as well as blinds, fences and enclosure walls, whether or not they are independent of the building.
2. Contents: the set of movable property items, i.e., not attached to the structure of a building, such as furniture, household appliances, clothes, decorative objects, household goods for professional use, jewelry and precious stones, and other complementary household goods.

In order to redress the asset loss suffered by the insured, multi-risk insurances present, among others, the following guarantees for property damage:

Fire

The insured is guaranteed compensation in the event of fire, for any damage suffered by the property specified in the policy, in addition to salvage and debris removal costs, including the following:

• Damage caused by measures adopted by the authorities or the insured to mitigate the consequences of a loss.
• Direct lightning strike, whether or not this causes a fire.
• Smoke damage.

Theft

The insurer undertakes to indemnify the insured for damages suffered as a result of the disappearance, destruction or deterioration of the insured objects, due to theft or attempted theft, carried out by persons other than the insured.

Water damage

The insurer shall indemnify, repair or replace the damaged parts and direct material damage to the contents or building, due to accidental spills of water from:

• Own or third party installations and conduits.
• Household appliances.
• Leaks that do not come from the exterior.

Usually excluded from this guarantee is:

• Damage due to seepage from groundwater or stagnant water, overflowing of rivers, canals, and so on.
• Damage due to the freezing of pipes.
• Leaks or dripping due to atmospheric precipitation.
• Costs of locating and repairing faults due to corrosion or the gradual sedimentation of impurities.
• Repair of household appliances and sanitary fixtures.
• Replacement of materials not damaged in the loss.

Broken glass

The insured is guaranteed the payment of an indemnity in the event of accidental breakage of any windows or glass described in the policy. The claims included in this guarantee are the following:

• For the building: glass of doors, windows, enclosing or distribution partitions and sanitary appliances.
• For the contents: glass in furniture, pictures, mirrors, etc.

Damage usually not covered by this guarantee includes:

• Scratches, scrapes, chipping and other surface deterioration.
• Damage to moldings or frames containing the insured pieces.
• Lamps, glassware, tableware and kitchenware in general. 
• Decorative objects, optical glass and sound or image glass.

2. Civil Liability

The insurance company undertakes to indemnify the insured for any damage to their assets as a result of a claim made by a third party for which they are civilly liable.

3. Assistance-type

Usually, this guarantee covers:

• Travel insurance for temporary travel.
• Home or domestic assistance, which provides services in the event of unforeseen events occurring in the insured home.
• Legal assistance, which protects the insured against expenses arising from claims for damages before the courts.

4. Supplementary coverage

Depending on the insurer offering the product, more cover and clauses may be included, such as, for example, the following:

• Coverage of vehicles inside garages: Damage to automobiles as a consequence of fire, explosion, lightning and theft or spoliation is indemnified. Depending on the conditions agreed upon in the policy, additional accessories such as radios, CDs or similar devices may not be included in this guarantee.
• Aesthetic damage coverage: Under this clause, the company will reimburse, up to a maximum limit per claim as detailed in the policy conditions, the costs necessary to restore the aesthetic appearance of the property prior to the loss.

Example: If the pipe in the bathroom of a house breaks, the insurer is responsible for its repair; to fix the damage, the wall has to be opened and, therefore, some tiles have to be broken. However, these tiles are no longer for sale and if other tiles were to be put in, the bathroom would not look very good with tiles of two types, no matter how similar they may be. In this case, the damage is considered to be aesthetic.

If the insurance policy includes coverage for aesthetic damage, the insurance company must replace all the tiles in the bathroom so that after the damage, the appearance of the bathroom is similar to that which it had before. For this, the insurer must pay an indemnity that includes the cost of the new tiles and the labor for their installation.