Insurance is an important concern for any homeowner, as well as people who don’t own their home. There are two types of home insurance that many people use. The first is buildings insurance, which protects the structure and integrity of the home itself, as well as any of the permanent features inside it. Then there’s house contents insurance, which covers your possessions housed inside your home.
Today, we’re going to focus on house contents insurance, what it is, what you should know about it and whether it’s needed. It’s a subject many people are unsure of and don’t always know what they really need from this kind of policy. We’ll clear up the confusion and provide you with the information you need below.
This is the first and most important question to answer. In short, contents insurance protects your belongings. Anything you own that’s in your home can be covered. Think of it as all the things you would back up and take with you if you moved to a new place. These are the things that are supposed to be covered by contents insurance. In theory, it covers the cost of those possessions if you ever needed to replace them all.
There are many things that can cause your possessions to be at threat in the home in some way. Whether it’s the threat of a fire, burglary or flooding that damages your possessions. These things all have the potential to occur, and it’s important that you’re ready to deal with them if they do. That’s what contents insurance aims to allow you to do, even if you hope you’ll never need to use it.
You need to know a few things about how contents insurance works. There are indemnity policies, which takes into account the wear and tear of your possessions, meaning that a damaged item will receive a lower payout if it’s damaged because of its age. Then there are new for old policies; these pay out the full amount of a brand new replacement, regardless of the damaged item’s age. You’ll pay higher premiums for the latter type of policy, however.
So, is it something that you actually need? Well, the easiest way to answer that is to say no, it’s not compulsory for you to have contents insurance. No one can make you have one of these policies, so in that sense, they’re not needed. Mortgage companies can require you to have buildings insurance, but they’re not going to make you insure your home’s contents too.
However, just because this kind of policy is not mandatory, that doesn’t mean it’s not wise to have one anyway. You may think that it’s a waste of money because you’ll probably never need to use it. That might be true, but you can’t know for sure and many people regret not having a home contents policy in place after they do experience a problem that causes damage to their possessions. It’s about how much of a risk you want to take with all the possessions you own.
People are often unsure of how they should value their belongings and how much to insure them for. Well, the obvious way to approach it is to insure them for what they’re worth. You want to be able to cover the repurchase of all those possessions in the event of you ever needing to. The average UK home has £55,000 worth of items in it.
When you’re deciding the value of your possessions, consider everything you own. That includes everything from all of your furniture and electricals to your kids’ toys, entertainment items like books, games, music and DVDs, as well as soft furnishings, jewellery and clothes. It’s all part of what needs to be covered by your policy. Make a specific note of any high-value items worth more than £1000. It’s a good idea to add up the value of your possessions and to then keep a running total so you can add things to it and take things away as you buy new items and get rid of old ones.
There’s a range of extra options that you can add to most house contents insurance policies. These aren’t usually offered as standard but you can pay a little extra for them if you want to. The first is accidental damage cover, meaning you’ll be covered for the cost of repairs or replacement if you do something like break your TV or drop your phone and smash the screen.
Then there’s legal expenses cover, allowing you to cover the costs of hiring a lawyer. This is often used when you need to take someone to court for causing damage in your home. For example, if a tradesman does something that damages your property, you might want to sue them. Home emergency cover offers a way of contacting someone for quick assistance and it’s covered by your policy.
There are many house contents insurance providers out there, and it’s important to compare the policy options on the market before choosing which one is right for you. There’s John Lewis home insurance, Admiral home insurance, Aviva home insurance and HSBC home insurance, as well as many others.
You should take a look at the prices and perks of each of those insurance policy providers and make a decision regarding which you feel offers you the things you need at a price you feel is fair and reasonable.
If you want to be sure that you’re fully protected in the event of a disaster in your home, whether that’s flooding, fire or theft, you need to have a house contents insurance policy in place. Failing to do so will only serve to create more problems for you and that’s obviously the last thing you need when you find yourself in that kind of situation.