Homeowners insurance – what type of policy do I need?

Are you confused about home insurance? Don’t know what product you need or even where to start? Well don’t fear, we are here to help you get to grips with the basics of home insurance, from how it works, to what cover options are available, to typical exclusions you need to be aware of before you purchase a policy.

There are lots of different types of home insurance available on the market. Before you can make an informed decision, you should familiarise yourself with the options available to you. 

What is home insurance and what types are available?

In a nutshell, home insurance covers the structural building that you own as well as the contents within it. Dependent upon your preferences, you can purchase buildings and contents insurance together or separately.

Asides from buildings and contents insurance, which we will cover in more detail shortly, there are other types of home insurance policies that you can purchase dependent upon your property type and insurance requirements:

Landlords insurance

If you own a property that you rent out then you are responsible for the maintenance of that property. A standard buildings insurance policy usually won’t apply to landlords because you, yourself do not live in the building. You will need an insurance policy that is specifically designed for landlords.

Landlord insurance also provides protection for such things as loss of rent and public liability, both of which are not covered under a standard buildings insurance policy.

See our guide for Landlord's Insurance here

Tenants’ insurance

This insurance is designed for those who do not own the property that they live in so do not need buildings insurance. This insurance policy focuses solely on offering cover for contents (e.g. electrical equipment, appliances & jewellery).

This type of insurance is very popular amongst students as it allows them to protect their contents, away from home.

See our full guide to Tenants' Insurance here

Listed buildings insurance

If you live in a grade I, grade II or grade III listed building then there may be certain restrictions that would make repairing it more expensive, not that but you must seek approval to do so. Based on this it is advised that if you own a listed building, you have listed buildings insurance to ensure that you have the right level of cover and policy inclusions.

See our full guide to Listed Insurance here

Non-standard construction insurance

Not all houses are built the same; some are self-built, maybe with a thatched roof and timber beams! Although your home may be totally unique, some insurers may shy away from insuring it due to the increased risk. You may be better getting insurance with a specialist insurer that deals with non-standard homes.

Holiday home insurance

One home insurance policy will not cover two separate properties, therefore, if you are lucky to own a holiday home then you need to ensure that you get holiday home insurance in addition to the buildings insurance you have on your primary home.

Holiday homes aren’t normally covered in the same way as your usual house because they’re usually left empty for long periods of time. This means there’s an added risk of burglary, as it’s a more tempting prospect for thieves. That’s where holiday home insurance comes to the rescue.

The type of homeowners insurance that you need will depend upon (a) what you want to cover e.g. building, contents or both, and (b) what type of property you own.

Buildings insurance- a closer look

What is buildings insurance and what does it cover?

Buildings insurance covers the structure of your home including any outbuildings that are within the parameter of your property. Standard fixtures and fittings such as your bathroom suite, fitted kitchen, water pipes and electrics.

Buildings insurance policies will vary from insurer to insurer but most should cover your property in the case of burst pipes, falling trees, fire, flood, storm, subsidence, theft and vandalism.

Common building insurance exclusions

Exclusions will vary dependent upon your insurance provider, however, generally speaking, buildings insurance will not normally cover your property for any damage that can be classed as general wear and tear. Neither will your insurance provider pay out for acts of war or terrorism.

Additionally, if your home is unoccupied for more than 30 days during a year, your insurance is likely to be invalid. This is because your terms and conditions state that the property is occupied. For example, your property has more of a chance of being broken into if it is unoccupied, making the insurance risk greater. Always read the small print before you buy buildings insurance to make sure you have the right cover for your needs

Is buildings insurance compulsory if I own my home?

Buildings insurance is not compulsory, but it is advisable. If you have a mortgage on your property it is always a good idea to protect your investment. After all, would you be able to afford the repairs if your roof caved in? Or would you be able to rebuild your house if it burnt down entirely?

If you are in the process of purchasing a house, it is a good idea to have buildings insurance on the property as soon as the contract has been signed and the house is legally yours, as you then have a financial interest in the property.

Contents insurance- a closer look

What is contents insurance and what does it cover?

Contents insurance is designed to protect any belongings that you may keep in your home. As a general rule, your contents are those items that you would take with you should you move house.

Just think, if your house burnt down, how much would it cost for you to replace everything that was in it? Chance are, the figure would be tens of thousands. This is where contents insurance comes in. although you are hopeful that you should never need to make a claim, in the unfortunate circumstance where you do, it is worth its weight in gold.

A contents insurance policy protects your stuff against theft or damage from fire and flooding. This could include things like:

Furniture: beds, wardrobes, display cabinets and dining tables

Kitchenware: pots, pans, utensils and small appliances (e.g. kettle, microwave)

Soft furnishings: cushions, throws, curtains and bedding

Electrics: large appliances, entertainment centres, laptops and game consoles

Entertainment: DVD’s, CD’s, books and vinyl

The list really does go on and you will be surprised at how much it all adds up to!

Common contents insurance exclusions

It is always worth reading the small print of any insurance policy before you commit to buying it, just to make sure that it offers the level of cover that you require. As with all insurance policies, there will be exclusions, most typically for contents insurance, the policy may have a limit on the amount that you can claim for or the amount of times that you can claim. Some other common exclusions are:

  • Cover for items outside of the home

  • Cover for accidental damage

  • Damaged caused by DIY

  • Wear and tear

  • Damage caused by pets

  • Damage to expensive items that have not been listed separately as ‘items of value’

  • Items within another property e.g. your daughters IPad may be covered on your home insurance when it is within your home but if she takes it to University with her, this is then not covered when outside of the home

Please check the policy terms and conditions and carefully review all exclusions before committing to purchasing a contents insurance policy.

Is contents insurance compulsory if I own my home?

Contents insurance is not compulsory but it is there to safeguard your belongings should you home be burgled, damaged by water or in the case of a fire. Where contents insurance may seem like a waste of money as hopefully you will never need to claim, just think to yourself: “If I had to replace everything in my house after a fire, how much would it cost me?”

So, what homeowners insurance do I need?

Dial Direct is here to help you get the right home insurance policy for your requirements. We offer buildings and contents insurance for standard properties but if you think you need specialised cover, it is worth speaking to a specialised insurer to ensure you find a policy that suits your properties requirements.

Remember, you should always be honest when completing a quote. If you fail to disclose any relevant details your insurance policy will be invalid and, in the case of a claim, the insurer will not pay out. An example of this is not disclosing that your property is a listed building or that the roof is thatched.

We hope that this guide provides you with the knowledge you need to make your decision!

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