Bharat Griha Raksha

What is Bharat Griha Raksha?

Bharat Griha Raksha (BGR) is a standard fire and allied perils policy for residential property, designed by IRDAI and offered by every general insurer that writes fire business. It covers the structure of a home, its general contents, or both, for any sum insured, under the same wording across insurers. It replaced the older use of the Standard Fire and Special Perils policy for dwellings from 1 April 2021.

The aim was a simple, comparable home policy that does not penalise ordinary homeowners for getting the valuation slightly wrong, which was the main cause of disputes under the old wording.

What Bharat Griha Raksha covers

Based on IRDAI's 2021 guidelines, as summarised in insurer documents:

• Perils. Fire, lightning, explosion, storm and flood, riot and malicious damage, impact damage, subsidence and landslide, bursting of water tanks and similar named perils. Earthquake and terrorism are built in, not sold as add-ons.
• Building. Sum insured is based on carpet area multiplied by the cost of construction, so it reflects rebuilding cost rather than the market price of the flat or house.
• General contents. Covered automatically up to 20 per cent of the building sum insured, subject to a maximum of ₹10 lakh, without listing items. Higher contents cover can be bought.
• Built-in extras. Rent for alternative accommodation and loss of rent while the home is unfit to live in, removal of debris, and architects' and surveyors' fees.
• Optional covers. Valuable contents such as jewellery and art on an agreed value basis, and personal accident cover of ₹5 lakh each for the insured and spouse.
• Term. Annual or long-term, up to 10 years.

Two features make BGR different from commercial fire policies:

Burglary, breakdown of appliances and public liability are not part of the base BGR wording. Insurers sell them as separate sections or packages. Since 2022 insurers have also been allowed to file alternative home products that vary the standard wording, as long as BGR definitions remain the reference.

What Bharat Griha Raksha means for distribution

• Home loans are the main entry point. Most BGR policies are sold alongside a home loan by banks and housing finance companies acting as corporate agents. The lender is noted as a loss payee, but the borrower can choose the insurer. Explaining that choice is a conduct requirement, not a courtesy.
• Long-term policies need clear disclosure. A 10-year single premium BGR sold with a loan is convenient, but the customer must understand the cover runs independently of the loan and what happens on prepayment or sale. Refund rules on cancellation should be shown at the point of sale.
• Contents is the gap customers notice at claim time. The automatic 20 per cent contents limit, capped at ₹10 lakh, can fall short for well-furnished homes. Raising it, and adding valuables cover where relevant, avoids disappointment.
• The no-average feature is a strong talking point. Because BGR does not apply under-insurance, the classic objection ("insurers cut claims") has a direct answer. The adviser should still set the building value correctly, since the claim cannot exceed the sum insured.
• It fits mass and rural distribution. BGR's simple structure suits POSPs, Common Service Centres and insurers' rural obligations, where dwellings in allocated gram panchayats count towards targets.
• Penetration is low. Home insurance remains a small part of fire premium in India. Insurers and intermediaries that use natural catastrophe events (floods, cyclones) for awareness, and offer simple annual covers outside the loan journey, are building the stand-alone market.