All you need to know about home insurance
It doesn't matter whether you live in a one-bedroom flat or a five-bedroom detached house, your home is no doubt your castle. So it's important to make sure that you have the right protection in place in case something should go wrong.
What if there was a fire or the roof was damaged in a storm? Would you be able to pay for the repairs? And where would you live if your house was uninhabitable? Your home also contains some of your most valuable possessions. Could you afford to replace your flat screen TV or your jewellery collection if you were the target of burglars?
What does buildings insurance cover?
There are two types of house insurance: buildings and contents cover. Buildings insurance covers the structure of your home, so the roof, walls and windows. It also includes the permanent fixtures, such as the fitted kitchen and the bathroom suite. Buildings insurance policies vary, but they should all insure your home in case of fire, storm, flood, subsidence, burst pipes, theft and falling trees.
Most insurers offer extra cover if you need it, though you will normally have to pay an additional premium. Accidental damage is one of the most popular policy add-ons. You might also want to consider legal expenses cover.
Buildings insurance will not normally pay out for damage due to wear and tear, or acts of war or terrorism. If your home is unoccupied for more than 30 days during the year, you could also invalidate the policy. Always read the small print before you buy buildings insurance to make sure you have the right cover for your needs.
Counting the cost of contents
You don't just need to insure the structure of your home; you also need to insure its contents against loss or damage caused by theft, fire, storms, lightning, flooding or other water leakage, as well as explosions or earthquakes.
The contents of your home might be more valuable than you think. The average family of four estimates their contents to be worth £25,000. However, their true value is actually closer to £55,000. And it's important to get the figure right so that your insurance will pay out in the event of a claim.
The best way to make sure you have adequate cover is to walk round your house room by room and make an inventory of your possessions. Jewellery, computers, iPods - they can all add up to quite a sum. And don't forget the contents of your shed. Contents also include clothes, furniture, carpets and curtains. If you are unsure, it might help if you think of the things you would take with you if you were to move house.
Make sure you read the terms and conditions of the policy because most insurers limit the pay out for a single item. For example, if the single item limit is £1,500 and a ring worth £2,000 is stolen from your home, you could end up with a £500 shortfall.
Your insurer will probably ask for details of any valuable items, and it is important that you give all the relevant information. If not, you could invalidate the policy and the insurer could refuse to pay out in the event of a claim.