A simple guide to home insurance

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Posted in: Insurance in FinanceTalk's Blog

Anyone who has ever had their home burgled or has suffered the after effects of a flood knows how devastating it can be to have to go through the loss of the property or the damage and sort out the insurance payouts. Therefore it is important to have as smooth and effective a policy as possible, while not paying too much. Thankfully the UK home insurance market is competitive, and you should be able to get a deal which is both affordable and protects your property in full.

For anyone not familiar with the market, UK home insurance normally comes in two types, buildings insurance and contents insurance. Normally a company will be happy to lump both types together into one policy, but some people will only need one or the other. For example, tenants living in rented property will not need buildings insurance normally, only contents insurance. But a landlord who owns the property they are renting out will need buildings insurance but not necessarily contents insurance.

To summarise, buildings insurance protects the actual structure of the building plus any fixtures and fittings in the house, normally meaning things like fitted kitchen units and light fittings, plus the actual house itself right to the bricks and mortar. Contents insurance on the the other hand protects someone's general belongings, like their clothing, electrical goods, furniture such as tables and sofas, jewellery, and kitchen cutlery.

Buildings insurance is often taken out as a matter of course when someone buys a home and it may be a condition that they have a policy in place before they are actually allowed to buy the house. This kind of policy will normally pay out for damage caused to a property due to vandalism, flooding, fire, and some more unusual eventualities like a house being hit by a car from the street. Subsidence may only be protected against if there is a recognised history of a property having it, and if you're worried about this it can pay to get a survey properly completed before applying for a policy.

Contents insurance guards against theft of and damage to your belongings and may include some extras like cover for if you take something out of the house, such as a laptop. This is something important to consider as it may be thrown in on a UK home insurance policy for free or you may have to ask for it as an additional extra. Potentially this could mean having something like your wallet or purse stolen while you're out of the house is not as stressful as it need be, and accidental damage is also an option, meaning your camera or computer is protected if it is broken while out of the house.

Remember that UK home insurance can be a vital lifeline - so don't be tempted to go without it, particularly if you are a tenant in rented property as it's easy to forget to arrange cover as you move in. As with many types of insurance, the excess, or additional value you agree to cover before the insurance policy kicks in, can be important and can increase or reduce the cost of a policy depending on what you agree with the insurance firm.