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Do you need contents insurance?
Having Contents Insurance for your home means that you will be able to replace most furniture and temporary items should they be damaged or stolen. This also includes floor coverings such as carpets, as well as curtains and blinds. The damage we’re referring to could be as the result of a storm, flood, fire, explosion, earthquake etc. Contents insurance isn’t a legal necessity, but it does make perfect sense since the value of your contents certainly adds up over the years and you’d probably find it financially impossible to replace it all right away.
The type of policy your insurer provides for your contents cover could vary between being (a) bedroom rated (b) sum insured or (c) unlimited sum insured. With the (a) option this means your cover will be based on the number of bedrooms you have in your home and with (b) how much you believe your contents to be worth. In the case of (c), it means – as the name suggests – that 100% of your goods are covered should the worst happen.
If you do have to sit down and calculate how much your goods are worth (i.e. everything you need was you to move house tomorrow) then an online calculator can help you find out how much everything will cost to replace at today’s rates. It’s worth noting though that many insurance companies consider that the average family living in a three-bedroom home has around £50,000 worth of contents. When it comes to very valuable possessions (such as rings, designer handbags etc) then it’s worth checking with your insurer what their single items limit is.
Different types of contents insurance cover
New for Old – With this type of policy, you will get the value of what your items are worth if replacing them (i.e. at current market prices). Only clothes – and other fabrics such as bedsheets – are different because wear and tear are taken into account here.
Indemnity cover – In this instance you’re not getting market value but only what the item is worth (i.e. a 10-year-old bed would be worth far less than a new bed).
Personal possessions cover – This can cover you should your laptop, jewellery, handbag etc get stolen while you’re in a restaurant or any other location outside the house.
Home emergency cover – This is for when the heating goes down or there’s a burst pipe etc.
Accidental Damage – Cover for when you – or a house guest – spills wine on your brand new white sofa or knocking over a bottle of turps on new kitchen flooring etc.
Legal cover – If you have to go to court, then this will pay your expenses for hiring a solicitor and any compensation costs that ensue.
Tips on getting the best value contents insurance
- Always shop around since contents insurance policies can differ hugely from insurer to insurer
- Don’t take in a lodger – as this will definitely increase your premiums. And if you do take in a paying householder and don’t let your insurance company know, then your insurance will immediately be invalidated.
- Make sure you have a top-notch security system. The reason for this is because the more difficult it is for a burglar to get in then the less likely you are to have your contents stolen. Insurance companies know this too.
- Increase your voluntary access. That way the price of your monthly premiums will be lowered.
- Pay annual insurance bill in one go in order to prevent having to pay admin costs for monthly payments.
- If possible, don’t make a claim. That’s because, in a similar vein to car insurance and the No Claims Bonus, with contents insurance, you’ll get a discount as the years go on if no contents cover has been paid out to you or your family.
- Don’t be tempted by all the optional extras that companies offer. This includes such things as a policy to pay legal expenses or a policy for home emergencies. You may never need legal expenses and you might even have enough money to pay for a home emergency sitting in your savings account.
What exactly is ‘accidental damages’ cover?
This covers you if, for instance, you knock over an expensive ornament or if your child spills hot chocolate on a white fluffy rug. Chewing or biting by the family dog or cat isn’t covered though. Neither will you be inured if you happen to operate a business from your home (you will need separate cover for this).
Will my bicycle be covered by contents insurance?
Yes, if your bike is stolen from your home. If it’s taken from a garden hut, garage or some other form of outbuilding (such as a garden room) then it will depend on the maximum level of cover for those premises.
What is the usual maximum cover for an outbuilding?
As standard, it’s usually up to around £5000.
How often do I need to get a valuation of my contents?
You won’t be required to get bi-annual valuations etc but some policies do say there have to be valuations within a certain time period – especially for jewellery. It also makes sense to let your insurance company know if you have invested in something expensive e.g. a new leather sofa at £2000 or a MacBook Pro etc. Of course, this may mean that you will also have to insure your contents for a bit more money.
Would the expensive joints of meat etc in my freezer be covered too?
Yes, most insurance companies will usually cover it up to around a sum of £1000.
Is it necessary for me to take out contents insurance along with buildings insurance i.e. on the one policy?
No, it’s not a legal requirement. It is, however, advisable – simply because it’ll be a lot less expensive for you to insure them together.