What do you need? Home insurance comes in two parts: buildings insurance and contents insurance. Buildings insurance, as the name suggests, covers the building itself. It is there to help out if there is some serious structural damage to the property. If you are the freeholder, then you will need this, but if you are only the leaseholder of your property, then you don’t need to worry about buildings insurance.
Contents insurance covers the contents of your home, and is an essential bit of cover for everyone.
Insuring The Right Amount. One of the most obvious ways to cut the cost of your home insurance is to lower the amount of cover you have. However, you should never be tempted to value your contents for less than they are worth.
When you go through your home, make sure you cover all of your possessions. Do not forget the attic, the garage and the garden shed.
Should you need to make a claim, your house may be assessed by your insurer and it’ll only pay out the amount that you’re covered for. If it decides that the amount insured isn’t enough to cover what was in your home, your insurer will ‘apply average’ to a claim, thus reducing its liability.
This is calculated by the sum insured, divided by the true value of the risk, multiplied by the loss. The pay out that you would actually get may be significantly less than what you were expecting.
Although it is less likely, try not to over-insure either. Of course all of your contents will be covered, but you’ll be paying more than you need to in premiums, which is a bit counter-productive.
As for buildings insurance, remember you only need to cover the cost of the rebuild, not the market value of the property.
Increasing The Excess. Increasing the voluntary excess on your home insurance will lower your premiums. Do think twice about how likely it is that you will claim though as it can put a heavy dent in your finances.
Increase Security. Fit some high security locks, install an alarm and get two bolt locks for the windows: it’ll bring your premiums down.
If you have just moved house it might also be an idea to get the locks changed as you can’t be sure who still has a key. It may also be worth joining a Neighbourhood Watch scheme as it can reduce costs too.
Think Twice Before Claiming. Take a moment and carefully consider whether you should make a claim. If it is a minor issue you’re probably better off getting it fixed yourself – making a claim will push up the cost of future cover.
Love is in the air
Brits splurge thousands on engagement rings as 3.5 million planned to pop the question in February, but a third continue to walk around uninsured.
‘I don’t care too much for money, money can’t buy me love’, sang the Beatles, which most of us would agree is certainly true. However, it is still the case that plenty of love-struck Brits splash a fair amount of cash on an engagement ring in time for Valentine’s Day, latest research shows.
Figures from insurer Policy Expert indicate that around 3.5million people – or 7% of all UK adults – are engaged in the month of February. And some are so smitten that they propose on what many think of as the most romantic day of the year, Valentine’s Day.
While the old idea that you spend three times your monthly salary on an engagement ring, prospective partners still spend an average of £1,060. One-in-twenty say they’ll spend even more, averaging over £5,000, while one-in-five are more frugal, or simply not as well off, and only spend less than £250.
Spending on wedding rings is slightly less, at an average of £768, with one-in-twenty shelling out more than £2,000.
Although an engagement or wedding ring might be something someone has saved up for a long time to buy, many don’t have the right sort of insurance cover if they lose theirs, as plenty do in any number of silly ways.
Policy Expert’s findings indicate that just over one-in-ten have somehow managed to lose either a wedding or engagement ring at some point in their lives.
As you’d perhaps expect, one of the most common ways of doing so is simply by taking it off and misplacing it, such as after hiding it in a ‘safe place’ while on holiday. Other rings are lost down sinks or drains, or in the sea or pool, and by being hoovered up or stolen or ‘hidden’ by a child… permanently.
As only one-in-twenty found their ring after losing it, the problem for many is that they won’t be able to claim on insurance cover for a replacement.
Just over a quarter don’t have the type of home cover which allows for loss, damage or theft away from the home. Another third are a bit hazy about it and say they aren’t sure if they do or not.
Plenty of ring-losers, just under two-in-three, don’t bother getting in touch with their insurer, while others didn’t know they could claim anyway. Only one-in-thirty-three actually do make a claim for a lost or stolen ring.
Some rings are so expensive, or indeed old and fragile, that it excludes them from a home cover policy, but the vast majority (86%) of ring owners don’t take out separate, specialist cover.