Whether you own or rent your home it is vitally important that you take out some form of home insurance to protect your assets. There are two types of home insurance; buildings insurance, which covers the general structure of your home, and contents insurance which, as the name suggests, covers the contents. Finding the right cover can be difficult so we have put together a list of some of the most commonly asked questions and their answers to help you navigate the home insurance minefield.
Is it compulsory to take out buildings insurance?
You are not obliged by law to take out a buildings insurance policy although if you do have a mortgage on your property your mortgage provider will usually insist that you take out adequate cover. If you are about to buy a home then you should make sure that you have buildings insurance that runs as soon as you exchange contracts.
What is excluded in a buildings insurance policy?
If your property incurs damage that is due to acts of war or terrorism, or simply down to general wear and tear then your insurance provider will not usually pay out in the event of a claim. You could also invalidate your policy if you leave your property empty for more than 30 consecutive days.
How do I calculate how much buildings insurance I need?
Your buildings insurance policy should pay out enough money to cover the cost of rebuilding your home. You can usually find this figure in your mortgage documents. Bear in mind that the cost to rebuild your home is not the same figure as your home’s current market value, or the amount that you paid for it; infact it is actually usually lower.
Can I insure an empty property?
Standard insurance policies do not cover your home if it is left empty for more than 30 days. However, an empty property can often become a target for thieves and vandals. Perhaps you have inherited a property and are waiting for probate, or you have moved into a new home but are still waiting to sell your old property? Fortunately, you can take out unoccupied home insurance which will protect your property, and will also cover you should someone incur an injury whilst visiting your property.
How much contents cover do I need?
The contents of your home are often worth more than you imagine. The best way to come up with an accurate figure of what your contents are worth is to make an inventory of all your possessions. Include things such as computers, televisions, jewellery, clothing and furniture; infact all the items that you would take with you should you move home. If you have a few very valuable items then you may have to insure them separately as most insurers set a single item limit which limits the payout for a single item.
Will my insurer replace my items on a ‘new for old’ basis?
Most insurance providers will replace your stolen or damaged property with a new one regardless of the age of your item. Indemnity policies are available which pay out the current value of your item allowing for depreciation. These types of policy are cheaper but the majority of people opt for new for old cover.
You can often add additional extras to the standard cover that you receive in return for a small increase to your premium. Cover for personal possessions away from the home is a popular choice as it covers valuable items such as cameras and mobile phones whilst you are out and about. Accidental damage cover can also be useful as it insures your possessions in case of accidents.
Can I still take out home insurance if my property is prone to flooding?
Many insurance providers are reluctant to offer insurance to those people whose homes are at risk of flooding. Insurance claims for flooding can be very expensive so premiums are likely to be high and excesses can also be set far higher than is standard. If you are offered insurance then your insurance provider may insist that you take preventative measures including moving the boiler and other meters and electrical points to above the anticipated water level, and installing flood boards.
My property has a thatched roof; do I need to take out specialist insurance cover?
If your property has a thatched roof then if it were to catch fire it would spread far more quickly. Most insurers offer specialist thatched roof insurance which will cover the cost of rebuilding your property should it burn down. However, it is also wise to install some additional fire prevention measures including a fire retardant coating and chimney lining.
I’m a student; do I need to take out contents cover?
If you are off to university you can take out student contents cover which will protect your possessions in cases of flooding, fire, and vandalism. You can sometimes add your contents to a parent’s policy but this doesn’t always work out cheapest. Even if you live in shared accommodation it is important that you insure your items, particularly musical instruments and bicycles.
Can I insure my holiday home?
Holiday homes are often left empty so they need specialist insurance cover. Both buildings and contents cover is a must as it will cover your property against structural damage and will cover the contents of your home. In addition, holiday home cover offers protection to both you and your visitors when the property is let out.