HomeHome insurance
Home insurance is usually made up of two separate polices - one for buildings and one for contents.
You can buy them both from the same insurance company or you can get them from two different insurers.
If you own your own home you should have both buildings and contents insurance. If you live in rented accommodation (public or private), you should have contents insurance. Your landlord should have buildings insurance on the property.
You can buy home insurance from most major insurance brokers, but you should always choose a broker who is registered through the Financial Services Authority (FSA).
If flooding cover is included in your policy you will be able to claim against your insurance and be reimbursed for the cost of any flood damage.
Always read your policy fully to check the different levels of cover offered.
You are responsible for making sure that the sum insured is enough to cover the cost of a disaster. The sum insured is the maximum amount the insurance company will pay out if everything is totally destroyed.
In the UK each year the average household spends:
- £205 on buildings insurance
- £172 on contents insurance, and
- £351 on a combined buildings and contents insurance policy.
For independent insurance advice contact ABI on 020 7600 3333.
Insurance helpful hints
- Shop around. Decide if you want separate buildings and contents insurance. If you have separate policies, you need to make sure that everything is covered.
- Remember buildings insurance is to cover the cost of rebuilding your home- not what it would cost to buy.
- Check what the excess is on your policy. If you buy online you may get a cheaper policy but your excess may be higher.
- If you have to make a claim, check if it is under buildings insurance or contents insurance.
- If you are renewing your policy check the policy details have not changed.
- If you take out a policy over the phone or online always check the policy paperwork when you get it to make sure it is what you actually agreed.
- Some policies may require a burglar alarm or extra security fittings and some may give you a discount if you have these.
- Indemnity cover only pays for the current value of the items. If you want the items replaced you need to get a policy which insures new for old.
- Insurance does not cover 'wear and tear'. It is for when something goes wrong like a flood, fire or a storm.
- Monthly direct debits can be more expensive than paying a lump sum up front and you need to check what would happen if you miss a payment.
