Property insurance – essential or an unnecessary expense

The properties in which we live are generally our biggest purchases in life, they are the places we spend much of our time, the places we fill with valuable possessions and one of the things we would least like to live without. Taking these simple facts in to account, the questions we must ask are, do our homes need protecting? If so, what type of protection do they need?

Property insurance is the obvious protection, it brings with it, ‘peace of mind’ and a ‘sleep easy at night’ feeling. So how do we get the right protection? We all like choice, but at times there is so much choice we‘re left confused and uncertain that we’re getting the best deal.

Making the right choice when buying home insurance

Property insurance is double sided. On the one side you have buildings insurance and on the other contents insurance. We all like choice, but at times there is so much choice we‘re left confused and uncertain that we’re getting the best deal. You can use comparison websites like MoneySuperMarket to make it easier to find the deal that suits you most.

Buildings insurance as you would expect covers the main structure of your property including any outbuildings (policy permitting). If your property were to be damaged in high winds or bouts of extreme weather, suffer from subsidence or fire damage the buildings element of your insurance would ensure your property was restored to its former glory. In terms of relevant cover; estimate the cost of rebuilding your property should it be flattened to the ground.

Contents insurance, again, quite self explanatory covers the contents of your property, think in terms of moving house, what would you load in to a removal van and what would be the value of that removal van ‘today’. If you feel that there are items within your home that are of significant ‘value’, for example, jewellery, watches or works of art, you should declare them (dependent upon value) so they can be detailed in the policy.

Accidental damage cover is often sold as an addition to a standard property insurance policy. It is designed in essence to insure the policyholder’s possessions against things such as spillages or breakages. It is important to fully understand what your insurance provider would define as ‘accidental’ before you commit to the additional premium. In layman’s terms we can assume that it would come about as the result of an incident that was not intended, culminating in physical damage leading to the items loss of normal function.

Mortgaged properties

Choice –there is no choice when it comes to a mortgaged property, your lender will insist upon seeing sight of buildings insurance to proceed with the mortgage. Your lender needs to be certain that should your home suffer any type of damage during the term of the mortgage; the cost to re-build can be recouped resulting in no loss to them.

Check the small print

It is vitally important to check the small print when committing to insure, particularly in relation to excesses which may be higher than you had anticipated. When entering in to an agreement with an insurance provider there should be a ‘cooling off’ period (see Distance Selling Regulations) during which time you may be able to cancel the policy should you find it was not what you were sold.

Renewing your insurance policy

We can at times become complacent when it comes to reviewing our household expenditure particularly in relation to the likes of car insurance, pet insurance and property insurance. We take it for granted that we’re getting the best deal and the yearly increases in premium are as a result of the general increase in the cost of living.

Given the competition for our business, it is vitally important to review the cost of your property insurance when the renewal notification drops through your letterbox. Notifications are generally sent 3 – 4 weeks prior to renewal so this gives you more than enough time to compare ‘like for like’ deals. If you’re not sure what you existing provider covers you for, check the policy as this will detail the premium paid and the level of cover you have. You should also note that insurance is often renewed automatically so if you are planning to switch be sure to inform your current provider as soon as possible as you could end up paying double. Never assume you’re getting the best deal, invest time in the short term and save money in the long term.

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