Whether you are a renter, landlord, or home owner, you need insurance for your property. If you are renting your home, then it is up to you to cover your belongings with a home contents insurance policy, and as a landlord, you need insurance for the building. Homeowners need insurance for both.
Staggeringly, many people don’t understand what their home insurance actually covers, which means some might not realise if their insurance isn’t adequate insurance until it is too late. Here in this quick guide, we are going to cover some of the home insurance basics so that you can make sure you get the right policy for you and your property.
Which Type of Insurance is Right for Me, and Why?
The majority of home insurance policies fall into three categories; contents insurance, building insurance, and combined contents and building insurance.
If you rent your home, then it is only your responsibility to pay for insurance to cover your property, which is the building’s contents. This is where many people slip up, with thousands of renters across the country paying to insure the building they live in, when that is their landlord’s responsibility.
Landlords and homeowners need a policy that insures the building and the land that surrounds it. This should cover them against things like floods and fire, as well as damage from third parties or extreme weather. Homeowners will also need to pay for insurance for the contents within the property which is often known as building and contents insurance. Every inhabited building should have both building and contents insurance, and building insurance will sometimes be required in the terms of a mortgage.
How Do I Find the Right Insurance for Me?
Cheap home insurance is not hard to find. Many homeowners, landlords, and renters will use an insurance broker to find them a great deal on cheap home insurance. These services will take all your details and your specific insurance requirements and retrieve quotes from insurance companies on your behalf. In the application process, the broker will help you to identify which type of home insurance you need based on your living status; renter, landlord, or homeowner, and also help you determine how much cover you need.
The biggest factors that will influence the level of insurance coverage you require will be your property’s value if you are a homeowner or landlord, and the value of your belongings in the home. The higher each of these are, the more coverage you will need and the higher your insurance costs will be.
What Are Excess Payments?
Most insurers ask for an excess payment when you are making a claim. This is often split into two parts; voluntary excess and compulsory excess.
Compulsory excess is a charge your home insurer makes when you make a claim. This is often a fairly nominal fee that is deducted from the total of your claim. If the fee was £50, for instance, and you were making a claim worth £500 then you would receive £450 from your policy.
Voluntary excess is an amount you can set in addition to the compulsory excess. The higher you set this amount, the lower your insurance costs will be, but bear in mind that if you make any claim, you will have to pay this added cost.
Hopefully, this home insurance guide has given you enough of the basic information you need to make the right home insurance choices.