What is home insurance?
Home insurance covers the cost of damage done to your home or belongings. When you buy a policy, you’ll need to decide if you need Buildings cover, Contents cover or both, and the amount of cover you want (the ‘sum insured’) which is the maximum your insurer will pay out if you make a claim.
The main types of home insurance are:
Covers the cost of damage done to the structure of your home, as well as any permanent fixtures and fittings like bathroom suites and kitchen cupboards.Tell me more about buildings insurance >
Covers the cost of repairing or replacing your belongings, such as furniture, personal possessions, appliances like washing machines and dishwashers, and things like pictures, curtains and rugs.Tell me more about contents insurance >
What does home insurance cover?
Buildings and contents insurance will usually cover your home and belongings for loss or damage caused by:
- Burst Pipes
- Storm or weather damage
- Theft (or attempted theft) and vandalism
You can also choose to add on extras to protect yourself against other risks. It may be worth considering:
You can choose to protect personal items such as your mobile phone, jewelry and keys when they’re outside the home and not covered by your standard home insurance policy.
This helps pay for somewhere else to live if your home becomes temporarily uninhabitable because of something you’re insured for (like fire, flood, storm or subsidence).
Covers the cost of unintentional incidents, things like spilling red wine over a cream carpet, dropping your laptop or accidently knocking water over it. Policies will differ by insurer so double check what you are and aren’t covered for. One thing many policies do have in common, is that they won’t cover you for damage done by pets – for instance, scratching or clawing.
Some issues within the home need fixing straight away, such as a burst pipe or broken window. Home emergency cover is designed specifically for such incidents but cover will vary from insurer to insurer, so make sure you check the terms carefully before purchasing.
Do I need home insurance by law?
Home insurance isn’t a legal requirement but if you don’t have it, you’ll need to cover the cost of repairing any damage to your home or possessions yourself.
If you’ve got a mortgage, your lender is likely to insist you have buildings insurance, but you don’t need to buy it from them and shopping around will often mean you end up with a better deal.
It’s up to you whether you choose to buy buildings and contents cover separately or from the same provider but a combined policy does have the benefit of reducing your admin as you only have one insurer to deal with.
On top of this, many insurers will discount a premium when you take out both buildings and contents cover. Having the same insurer cover you for both could also mean there is less hassle when making a claim that might go across both cover types.
How much is home insurance?
The cost of home insurance depends on the amount of cover you choose and whether or not you’ve added on any extras (like Personal Possessions or Home Emergency).
For buildings insurance, the cover you have needs to be enough to rebuild your home if was completely destroyed (it’s not the market price of your home). You can find out the rebuild cost by either:
- Using a chartered surveyor who will assess the size of your home to work out the rebuild cost, but this can be expensive.
- Using a rebuild calculator like the one offered by the Building Cost Information Service (BCIS).
For contents insurance, the sum insured needs to cover the cost of replacing all your belongings. This includes clothes and personal possessions, as well as furniture such as your kitchen appliances, beds and sofas. Don’t forget things like curtains, rugs, cushions and pictures – all the things that make a house your home.
When it comes to valuing contents, it’s all too easy to over estimate how much things are worth but this can lead to over-insuring which could increase your premium.
On the flip side, it’s also easy to under-insure your belongings, in which case your cover won’t be enough to meet the cost of replacing your things.
The best course of action is to try and be as accurate as possible and go through your home room by room, noting down all your furniture and possessions and totting up the value.
You should bear in mind that most policies will come with a cap on how much you can claim for one item – known as the ‘single article limit’.
If you have any particularly pricey items – like an engagement ring, antiques or expensive TV – then you should let your insurer know as they will need to factor this in when it comes to working out the cost of your premium. In some cases, very expensive items may need to be specified on your policy.
Which insurance is right for me?
The right policy for you will be the one that meets your needs and while cost will also be an important factor to consider, it shouldn’t be the only one.
Before you rule out policies that look expensive – check to see what they include. You might be surprised to find some cheaper quotes actually work out more expensive by the time you’ve added on extra features that other policies include as standard.
Compare home insurance
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