Unfortunately, the nature of insurance means that you need to think about bad situations that could happen to you … burglaries, medical problems, car accidents, emergency home repairs. It may sound gloomy to have to think of what could happen in the future but it’s important to do, in order to protect yourself from some of life’s biggest surprises.
When it comes to protecting your home, it’s not just about safeguarding against structural damage or theft, it’s as much about feeling safe and having peace of mind in the place that you live and call home. If disaster strikes, your focus should be on getting yourself re-organised and back to normal. The last thing you want to be worrying about is money and having to cover the costs of getting your life and home back to normal.
In order to help get you sorted and set up with peace of mind for your home, our home insurance specialists, along with some of our house insurance customers, have developed a comprehensive guide containing 10 things you should know about house insurance. As this is a comprehensive guide we have split it in two. Be sure to have a read of Part One now and keep an eye out for Part Two of this guide next week.
1. What A House Insurance Policy Covers
A typical house insurance policy will cover you for damage to your home and your possessions in the event of certain situations. For example theft, vandalism, fire, or storms. It can also provide liability coverage if someone gets hurt on your property and decides to sue you for damages.
House insurance can protect belongings outside the home, too. If something is stolen from your car, your car insurance won’t cover it. You can make sure that your house insurance policy has it covered.
Wind damage is also covered on your home insurance policy. For example if there is a storm and the wind damages part of the roof of your home you can make a claim for the cost to repair the damage caused.
2. What It Doesn’t Cover
A standard policy has exclusions, including earth movements (landslides, sinkholes, etc.), power failure, war, nuclear hazard, government action, faulty zoning, bad repair or workmanship, defective maintenance, and wear & tear.
If your area is prone to flooding, you should consider additional cover, although you may find that some insurance companies will not offer flood cover in highly prone areas.
Some policies have different standard excess levels. The excess on a policy is not covered and as such it is a good idea to be sure you know of any hidden excesses that may be on your policy. You will be required to pay the value of any excess on a claim.
3. How Replacement/Rebuild Value Differs From Market Value
There are two key distinctions that every homeowner should know: “replacement cost” versus “market value.” Replacement cost covers the repair or replacement of your entire home in the event that it is damaged or destroyed. Market value is how much someone would pay to buy your home and the accompanying land.
One thing to note is that when you are insuring your home you should insure it for the cost it would be to replace or rebuilt your home and not the current market value. If you insure it for the current market value you will not receive the different in value if the market strengthens and your house value increases. This is why you should always look for the replacement/rebuild value and cover it for this.
4. What Can I Do To Reduce My Premiums
It may sound like common sense to have working smoke alarms, but did you know that they can help you to get a lower insurance premium? The same applies for a burglar alarm. Even installing more basic security features, such as a deadbolt lock, can help reduce the house insurance quote you receive.
In the world of insurance, insurance companies price your premium based on how much risk they believe that you pose. Reducing your risk, even with the simplest preventive measures, can help drastically lower your risk in the eyes of insurance companies. For example, if you are lucky enough to have a pool in your home or garden, you may be able to reduce the likelihood of a claim by installing a fence and a pool cover to minimize the risk of an unfortunate accident happening. These are things that the insurance companies will acknowledge as risk prevention measures and they can help to lower your premium.
Something that can quickly raise the cost of your insurance premium unnecessarily are policy extras that you may not need. Be sure to read your policy carefully and remove and addition cover that you do not need. This is a quick and easy way to reduce your premium while still maintaining the right level of cover for you house.
5. Why You Shouldn’t Wait to File a Claim
If you wait too long, you may find that it is too late to make a claim and the insurance company will not address it, especially if waiting has made the problem worse. A good example of this is when a customer whose home had suffered water damage, waited almost a month to do anything about it. Not addressing the problem promptly meant that additional damage that could have been avoided was caused. The insurance company addressed this and did not pay out for the claim. This is something simple that a lot of people tend to overlook.
As you can see, with just part one of two, this is a comprehensive guide to house insurance. Be sure to keep an eye out for Part Two of this guide coming next week. If you are unsure about anything we have described here and would like further clarification, you can call our home insurance specialists on 0818 288 188 and they will be more than happy to speak to you.
If you would like to get a low cost home insurance quote that is specific to your home situation, you can also call our specialist team on 0818 288 188 or fill out our quick quote form online.