Question 1

Does property insurance cover earthquake damage in Nepal?

Accepted Answer

Standard fire policies do NOT include earthquake. You must add earthquake coverage as an add-on, which typically costs 15-25% extra premium. Given Nepal's seismic risk, this is highly recommended.

Question 2

How is the property value determined for insurance?

Accepted Answer

Coverage is based on reconstruction cost (cost to rebuild the structure), not the market value of property including land. A valuation surveyor may be required for high-value properties.

Question 3

Does property insurance cover tenant's belongings?

Accepted Answer

The landlord's policy covers the building structure only. Tenants need separate contents insurance to cover their furniture, electronics, and personal belongings inside the rented property.

Question 4

What is under-insurance and why should I avoid it?

Accepted Answer

If you insure for less than the full reconstruction value, claims are proportionally reduced. For example, insuring a NPR 1 crore property for only NPR 50 lakh means you receive only 50% of any claim.

Question 5

Are natural disasters like floods and landslides covered?

Accepted Answer

Flood and landslide coverage is usually available as an add-on to the basic fire policy. Given Nepal's monsoon risks, adding this coverage is advisable for properties in vulnerable areas.

Question 6

What documents are needed for a property insurance claim?

Accepted Answer

FIR (for theft/riot), fire brigade report (for fire), photos of damage, repair estimates, property ownership documents, and the original policy. Report claims within 24-48 hours.

Property & Home Insurance in Nepal

Property Insurance FAQs