Why do we get home and contents insurance? For one thing, it’s to ease the financial burden if something unfortunate was to happen to your property and possessions. It can also be that we may not have enough savings to renovate or rebuild our home that sustained severe damages. Whatever it is, it goes without saying that having enough coverage for home and contents is essential.
If you have home insurance, what if you do not insure for the amount that is needed to rebuild and replace your property? In other words, what if your home is under-insured? It should be avoided at all costs as it can bring about a significant impact to your insurance payout in case you need to make a claim.
Are you at risk of being under-insured? Are your property and contents insured for the right value? Avoid some of the pitfalls by following these simple tips:
- Before purchasing or building a home, be sure to compare home insurance policies. Get several quotes from different insurers. If you’re in a flood-prone area, the premiums may be higher.
- Check if your home has building renovations, improvements or extensions as these can greatly affect the value of the property.
- Before renewal, consider the purchases that you’ve made. These include electronic equipment, furniture, jewelry, and other valuables.
- Check the sum insured limits of your policy. You may need to get coverage for possessions that may not be included in the standard contents policies.
- Inspect each room and see how much it would cost to replace each possession. Make a list and include everything, including books, clothes, shoes, cutlery, bed linens, etc.
- Bear in mind that there can be limits set for valuable items. If your possessions exceed the limits, make sure to create a separate list for them. Otherwise, you will not be able to make a claim that is over the standard sub-limit.
- When it comes to your property, consider the costs of removing debris or complete demolition, architect’s fees, expenses for the materials, mortgage discharge fees, charges to comply with the council regulations, etc.
- Make sure that these expenses are part of the sum insured amount, or if they are part of the coverage on top of the sum insured amount.
- If you live in a flood or fire-prone area, consider purchasing extended or total replacement protection. Bear in mind that in times of wide spread disaster, the costs of building services and temporary accommodation will often increase.
Do you have other ideas on home insurance comparison? Share your insights in the comments section.