What Is Home Insurance And What Does It Cover?
Home insurance provides a financial safety net for loss or damage to your property or the contents within. It comes in two forms; Buildings insurance and Contents insurance. Buildings insurance will cover damage to the structure and permanent fixtures to your property whereas Contents insurance would cover personal items within the property.
Home Insurance Explained
Home insurance has 2 primary principles to it, Buildings insurance and Contents insurance. Neither are required by law but some mortgage providers may require you to take out Buildings Insurance as a stipulation under their mortgage agreement. This will cover damage to the structure of your property, for example; the floors, walls and roof. It typically covers other fixtures too such as a fitted kitchen, built in wardrobes, things that wouldn’t normally be taken with you if you were to move home. If you do own your property then this is something that should be given serious consideration too, as the cost to put something right could quickly escalate.
Depending upon the type of policy you take out, you may or may not be covered for certain acts of nature like storms and floods, subsidence, fire, damage from burst pipes and much more – if you have specific requirements to cover things like these, you will need to make sure that you discuss these with your insurance provider before taking a policy out, otherwise you could be left out of pocket if something happens and you don’t have the cover you perhaps thought you did. One important thing to note though however, is that you won’t be able to make a claim against general wear and tear of the property.
Contents insurance protects you against any damages or losses made to your personal possessions within your home. This would include things like your appliances, valuables, furnishings, furniture and money. You can get covered against a wide range of circumstances but the most common ones are fire and theft. Your insurer may also offer accidental damage as an optional extra, but this will increase the price of your premium. This would cover things such as knocking your TV off its stand as you reached to close the curtains, or spilling red wine on to your prized rug. When obtaining Contents insurance it is important to state the value of the more expensive items so that they can be factored into your policy. This is because many policies will only cover up to a certain percentage of the total contents cover per item. For example, if you tried to make a claim on your £20k watch from your £50k total cover policy without outlining its value at the start, you may only end up with a few thousand pounds in return.
Many factors will be taken into account calculating your premium/price; for Contents cover, these could be based on your postcode, previous claims, smoke alarms, fire extinguishers, the total sum insured and your policy excess; for Buildings insurance elements like location, proximity to potential hazards, age of the building, total sum covered, and building material type are just a few of the factors insurers take in to consideration. It is important to note that each insurer will have different policy structures. Some will allow certain things whereas others may not. It is advisable to read the policy small print so that you are fully aware of what you are and aren’t covered for.
So what are the levels of cover available?
- Standard Home Insurance
- Non-Standard Home Insurance
- Contents Insurance
- Buildings Insurance
- Buildings & Contents Insurance
- Accidental Damage
- Legal Expenses Cover
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