Indo-Pak conflict: Your home insurance is of no use, say experts

Business Standard

09-05-2025

Operation Sindoor, the military action against Pakistan, has prompted Indians living near the borders to wonder if their home insurance policies will protect them in such conflicts.
'War, invasion; act of foreign enemy hostilities or war-like operations; civil commotion amounting to a popular rising; insurrection, military or usurped power are excluded [from insurance protection],' said Amrish Dubey, senior-vice president, personal lines, Tata AIG General Insurance.
'War' exclusion
'Standard Indian home insurance contracts universally exclude war or war-like operations – whether declared or undeclared,' Dubey said.
The clause typically defines war as:
'War, invasion, act of foreign enemy hostilities or war-like operations (whether war is declared or not), civil war, mutiny, civil commotion amounting to a popular rising, military rising, rebellion, revolution, insurrection or military or usurped power.'
By defining war so broadly, insurers protect themselves against unpredictable and massive losses that military conflicts entail.
Homeowners' options
'In light of the immense potential liabilities and the difficulty in assessing and pricing such risks, homeowners do not currently have the option to extend their policies to cover war-related damages, regardless of escalating tensions or military operations,' said Rohit Jain, managing partner at Singhania & Co, a law firm.
Unlike shipping or aviation sectors, residential property remains outside war-risk underwriting.
Terrorism, acts of war
'Terrorism can be covered under home insurance policies as an optional add-on,' said Dubey. Terrorism is defined as 'an act or series of acts … use of force or violence … by any person(s) on behalf of or in connection with any organization(s) or government(s) … for political, religious, ideological or similar purposes.'
This option is limited as well. 'If damage arises from cross-border strikes involving national armies, insurers will classify it under the war exclusion and deny the claim, maintaining a clear distinction between terrorism and acts of war,' said Adhil Shetty, chief executive officer of Bankbazaar.com.
'Political-violence' extension
Jain said that a 'small number of insurers' offer limited political-violence or civil-commotion endorsements. To activate these extensions, policyholders must:
Lodge the claim and preserve evidence immediately
Submit a police FIR when applicable
Provide photographs, repair estimates, and original purchase invoices
Supply media or government notifications confirming unrest'
He added, 'Accuracy and timeliness in documenting the event play a crucial role in the success of such claims.'
'The burden of proof lies with the policyholder,' said Tushar Kumar, advocate, Supreme Court of India. 'Insurers require conclusive evidence, such as engineers' damage assessment reports, authenticated media coverage, and official notifications, to establish that losses directly result from political violence or civil commotion as defined in the policy.'
Homeowners in sensitive border areas should review their insurance policies, ask insurers about any available extensions, and maintain records.