April 21, 2020
Home ownership comes hand in hand with home insurance and it is one of the most important insurance due to the high cost of properties. Home insurance may be unchartered territory for you, or you may be unsatisfied with the policy you currently have. In this article you will find some top tips that will help you navigate the home insurance market with confidence. When you follow the tips and tricks laid out in this article, you’ll find the best policy for your needs and the lowest premiums too.
Tips on Finding the Best Home Insurance for your Property; Building versus Contents
One of the first and most important things you need to learn when searching for an insurance policy for your property is the difference between building insurance and contents insurance. You may require one, or indeed both of them. Both building and contents insurance offer protection against risks such as theft, fire, flood, escape water, malicious damage, accidental damage, and subsidence. However, there is a difference between the two. Property insurance focuses on the structure of your home, its outbuildings, and fitted fixtures. Contents insurance on the other hand is concerned with the movable objects you find within your home such as your furniture and electrical equipment.
If you own your home as opposed to renting it, and currently have a mortgage, buildings insurance is likely to be a condition of your mortgage. If you own your property outright or indeed rent a property, you won’t actually need buildings insurance. As the owner of your home you will however want to protect your investment. So, the only situation where buildings insurance is irrelevant is when you are a tenant; this insurance is the responsibility of the landlord.
Contents insurance is always optional, but is highly recommended for both rental tenants and homeowners. It protects against a whole array of problems include loss of belongings due to a flood or damage that is the result of a flood or a burst pipe. As a landlord, you may still take out this insurance if the fixtures and fittings and the furniture in the home you rent belongs to you. This type of insurance will be in addition to your buildings insurance.
Home Insurance for your Property; Comparing Premiums and Policies
When taking out home insurance, it’s tempting to simply search for the one with the lowest premium. As tempting as it may be to simply focus on the annual premiums on offer, you should never just go for the cheapest options. There are many other factors that you should take into consideration when comparing policies and premiums. For example, as well as just comparing the premiums, be sure to compare the small print on the policy wording and the excesses too. If a policy is offering a lower-than-normal premium, it could well be that it comes with a higher-than-average excess on the policy. So, in the event of a burglary or a disaster at home, you will actually end up losing out as the payout your receive will be significantly lower. Also, some covers may not be automatically included, and only available for an added cost.
Getting the Math Right
When working out the best home contents or building insurance for your needs, it is extremely important to get your math right. Being accurate is crucial, and being insured for less than you need could cost you a more in the long run if you make a claim on your insurance policy. One way to avoid this is to select a policy that offers a blanket sum. For example, you could take out a policy that would cover your contents up to 75K. This value is more than adequate for the average family. Premiums of this type for both building and contents insurance are calculated on the number of bedrooms your house has, or the amount need for rebuilding; in this case, the value of similar properties in the area is taken into consideration.
Belongings Kept Outside the Home
When taking out a contents insurance policy, it’s important to cover contents of items that are not kept inside the home. This could include items kept in garages that are separate from your home it items in your garden building or shed or conservatory. One item you should pay particular attention to is a bicycle. Pedal cycles can be included on your home contents insurance, but will often be outside the home when stolen. If you have bicycles of value it is a good idea to specify them on your policy.
Building and Contents Insurance: Understanding Excesses
Excesses are the amounts you will be expected to pay towards a claim, should you make one. You may have an auto policy that has an excess on it already; excesses on contents and building insurance policies work in the same way. The excess on your policy will be set by your insurer and will generally be compulsory. For this reason, it is extremely important to check the excesses on premiums that appear to be low when compared to others. It is extremely important that you can afford the excesses. As an example, if your home floods due to a burst pipe, an excess of the first 250 pounds towards the repair to your home is affordable to most, but more than this figure could be tricky to come up with unexpectedly.
We already mentioned items that are often found outside the home. You should also include items that you wear or that you have on your person at all times. These include watches and jewelry, mobile phones, laptops, and tablets. If you often travel with your laptop, then you should consider adding it to your policy as an optional “add-on”
High Value Property
Depending on your lifestyle, you may need to seek special cover for high-value property. An average insurance policy will insure you for up to 75K for contents and 500K for buildings. If you live in a property that is of a much higher value, or have items in the home of much higher value, you will not be covered by a standard policy. High-net-worth policies are suited to such home owners, their premiums naturally being higher than those of a standard policy. These types of policy usually cover your contents on a global scale, perfect for those who travel for business taking items with them, and leaving their homes empty for extended periods of time.
When comparing the various contents and buildings insurance policies available on the market, it’s important that you conduct thorough research. Always make sure you read the terms and conditions and make sure that you are happy with all the details. Pay special attention to the excesses you will have to pay in the event of theft or accident. You will also find that all policies have exclusions that will not be covered. Some of the most common of these are “wear and tear” and “rising damp”. Lastly, if you have some specific items that are of great value to you as well as being valuable objects, consider adding them as add-on extras to the policy you take out.