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Archive for the ‘Home Insurance’ Category

In order to qualify for a mortgage in the United Kingdom, the person or persons receiving the loan have to take out a buildings insurance policy for the property they are purchasing.  The main reason this comes as a prerequisite of taking out a mortgage is because it ensures the money that is loaned is as secure as it could be with regards to damage to the property.  Without such a safety net, if the property were to be destroyed in the event of a fire, for example and the mortgage holder could not afford to pay back the loan, the lender would have no means of recovering their investment.

For many homeowners living in the United Kingdom today, cutting down their outgoings is particularly important.  A huge number of people are taking a critical look at their outgoings in order to try and save money wherever possible.  Utility bills are high on the list, as are insurance policies.  For example, research carried out by an accountancy firm found that, in 2009, some 34% of UK policyholders switched their provider in order to secure a better deal.  The survey also found that policyholders had no loyalty to their existing insurer and that the price of the policy was the biggest factor to be considered.

In addition, the survey found that more and more people are looking to buildings insurance comparison sites when renewing or taking out a policy.  The number one reason for this is to save money, but it is also because, for the many Britons that lead busy lives, it saves a great deal of time.  As the number of home insurance policies available has increased, so has the number of providers customers feel they need to compare prices with.  However, the cheapest policy may not always cater for all the homeowners needs.

In order to get a home insurance quote, you must provide certain crucial details to your provider.  The more accurate this information, the easier it will be to make a claim.
 
Halifax Home Insurance offers an impressive list of things that are included in their policy as standard. Apart from the usual larger items, like your sofa and TV, this company has gone a step further and included some extras that you may have not even thought about, but would be a welcome help should you need to claim.  They include a £2,000 sum for any downloaded data that has been lost, so as well as a new laptop or computer you can also get back the value of what was inside the machine if there is no way to retrieve it.
 
Concerning the food in your freezer, this is covered up to £500. 
 
Some of these extras have to paid for with other companies, and may not be included as standard. Halifax has thought about the little things for you, to give peace of mind about every aspect of your home and belongings.
 
When searching on a comparative website, this information would not show up until after you had input all your details, or chosen this particular policy.  You will also get a discount for buying buildings and contents insurance together with Halifax.  If you are already a customer with the bank, getting a quote is easy, you should make an appointment so that an advisor can talk you through the policy, or study it yourself online. 

Everyone who owns a house or other property needs to have the building itself as well as its contents covered against mishap.

In the case of buildings insurance: If damage to the structure through fire, flood, or some other catastrophic event that necessitates its rebuilding is caused, the insurance will cover the costs. Buildings insurance usually also covers damage to external fixtures and fittings.

Buildings insurance is always a condition when taking out a mortgage, as it is effectively security for the loan, and protects the lender as well as the borrower against damage to the property, which is an investment for both.

Contents insurance is not usually a condition of taking out a mortgage, but it is wise to have it in place anyway. Contents insurance covers items in the home that are not fittings, such as furniture, clothing and jewellery, although it also covers items such as cameras that are taken from the house on a regular basis by the owner.

Separate travel insurance will have to be taken out in most cases when taking items abroad with you, as they are unlikely to be covered by the contents policy if lost or damaged in another country.

A contents policy may also become invalid if the homeowner is away for any length of time.

Unlimited cover, which most people have, ensures that lost or damaged items are replaced no matter what the cost may be, although the circumstances of the loss or damage will be the crucial factor when the insurance company is deciding whether or not to pay out.

When you take out a mortgage you will be obliged by the lender to take out buildings insurance. This covers you in the event of the property suffering severe damage through fire, flooding, subsidence or some other catastrophic event and it having to be rebuilt. It covers the lender too, of course and is effectively a security on their loan to you.

Contents insurance, on the other hand, is not obligatory whether you have a mortgage or not, but it is highly recommended that you take it out. This type of cover protects you against theft, loss and damage to your possessions or the non-fixed items in your home, such as jewellery and electronic goods. Some types of contents policies treat the garden as another room, so the shed and any non-fixed items can be covered against loss and damage.

A contents policy may well also cover your possessions when they are taken out of the home, such as cameras and handbag. If you take them on holiday with you, however, the contents policy will probably not cover them and you’ll have to take out separate travel insurance. Check the details of your policy or give the insurer a call.

Home contents insurance, if taken out along with buildings insurance from the same provider, may result in reduced premiums and it’s also a good idea to shop around for the best deals. Even with buildings insurance, you don’t have to accept the policy suggested by the lender.

It is sometimes confusing for the new homeowner when confronted with the vast range of options out there when it comes to home insurance. When you take out a mortgage the mortgage lender will make buildings insurance a condition of the loan. The lender will be only too happy to recommend their own buildings insurance provider, but you’re under no obligation to accept.

In fact, it’s better to look up a few comparison websites to get some house insurance quotes. Cheap house insurance is available, and offers come and go, so you’ll have to take a calculated plunge at some point. Be careful not to be paying premiums for things you don’t need, such as protection against flooding if your house is in the mountains, to mention one extreme example. And earthquakes in Devon are probably not a major concern either.

When it comes to contents insurance, the cheapest form of this is indemnity insurance, but if your property gets damaged or goes missing it will only be replaced by items comparable in age and condition. The more popular ‘new for old’ home contents insurance will get you completely new replacements for only a bit more on the premium.

The basic coverage will be unlimited, meaning that the cost of the items is not an issue and the payment will be automatic as long as the conditions have been met. Coverage can be extended but it will cost you more in larger premiums.
Get a few home insurance quotes before deciding on one suitable for you.

You need home insurance to protect your house and its contents. Having buildings insurance in place is a condition of taking out a mortgage, but house contents insurance is up to you. However, you should remember that it is always best to pre-empt unpleasant eventualities by having both in place.

House contents insurance will protect you from the financial consequences of a burglary, but also against accidental damage to your possessions, such as a power cut destroying your freezer contents. Bear in mind that if you’re away from the property for a lengthy period of time the policy may be invalidated and that some costly items may need their own separate insurance. This may apply to valuable antiques or paintings.

New-for-old house contents insurance replaces any lost or damaged items with their brand new equivalents, but you can choose the cheaper indemnity insurance if you wish. This will replace possessions with those of the same age rather than new ones. Most people tend to opt for a new-for-old type policy.

Travel insurance is usually needed to cover possessions you take on holiday with you, although items you regularly take out of the house, such as bags and cameras, are usually covered by the home contents insurance.

Buildings insurance protects the bricks and mortar of your property against such disastrous eventualities as fire and subsidence and is compulsory when you take out a mortgage. Buildings insurance is linked to the cost of rebuilding your house should it be severely damaged or completely destroyed.

Compare home insurance quotes to see what is on offer and find the policy that is suitable for your individual needs.

Buildings insurance – or home and house insurance – is the insurance that covers the structure that is your home. While the finer points of policies may vary, all house and home insurance covers the main building on your property, i.e. your house; and most can be extended to include other structures such as a swimming pool, garden shed, and garage.

Anyone buying a home will more than likely be required to have home insurance as a condition of their mortgage. In fact, most lenders provide home insurance with their mortgages. But these can often be pricey and don’t always offer the type of coverage desired. So it is important to shop around for the right house insurance at the right price.

A good home insurance policy includes a few things:

•    It should cover you for flood, fire, storms, lightning damage, subsidence, or damage caused by falling objects, like trees, or objects from aeroplanes.
•    It should cover you for acts of vandalism and theft.
•    If the amount of damage done to your home is sufficient enough that you can no longer live there, then a good home insurance policy will cover the cost of alternate living accommodations.
•    The amount of coverage, or ‘sum insured’, should not be the amount your home would be worth if you sold it, but rather the cost of rebuilding the structure if it were knocked down.

Before committing to any building insurance policy, it is important to read the policy thoroughly, including all fine print clauses.

Most home or house insurance will cover you against loss of your premises from fire, but what does that really mean?  Does it mean your house has to burn to the ground before you collect?  That’s not a terribly appealing prospect to most people.

When purchasing insurance; read the policy carefully before you purchase.  One thing to pay particular attention to is the excess, or how much you are expected to pay on a claim.  The higher your excess, the lower your premium -but make sure you have funds available to pay that should the need arise.  For example, a £2,500 excess on buildings insurance means that should a claim be paid, the first £2,500 of reimbursement would be on your shoulders.

Insurance will pay on less than a total loss, but you don’t want to make too many claims because that can risk revocation or cancellation of your policy.  Insurance is designed to pay for catastrophic loss, so minor claims, as in a small chimney fire that you put out yourself and that leaves little or no damage, might not be worth a claims history.

You can reduce the amount of your premium payment with a few simple steps.  Ask your potential insurance carrier about discounts for smoke alarms, sprinkler systems, fire extinguishers, and other items that not only reduce the risk of a fire, but help you keep damage to a minimum.  If you’re a smoker, see if that raises your rates (it probably does) and consider stopping.  You’ll save money on cigarettes as well as your house insurance.

Especially if you’re purchasing home insurance or contents insurance for the first time, the number of new industry terms may be quite daunting.  Here are a few of the more common ones, and examples of how they might apply to your policy.

Cover – This can refer to both the monetary amount that the insurance will pay as well as specific situations addressed by your policy.  For example, you usually have to purchase separate earthquake cover for your home insurance; that eventuality is not included in most policies.  And various types of situations will have a different amount of cover.  Your house insurance may have a £50,000 cover or a £500,000 cover – depending on the value of your house and how much you’re willing to pay.
 
Excess – This is the amount of “out of pocket” money that you will pay against a claim.  For example, if you sustain a £5,000 loss and have a £1,000 excess, the insurance company will pay £4,000 of that claim. 

Policy – The legal paper that outlines who purchases the policy, who insures what and to what levels, the amount of excess, any exclusions, and other legal details regarding your cover.  The policy itself is very important to keep; the insurance company may occasionally make adjustments to items, and you need to be able to compare those changes to the original wording and decide whether or not the policy still fits your needs.

 Quote – This is an estimate by an insurance company of what a specific policy would cost. The estimate will be based on information you supply; the final cost may be adjusted a bit if changes are needed due to lender requirements or local law.

 Rider – This is a kind of “attachment” to your main policy that covers something specific, usually a high-value item.  For example, your insurance company may require a separate rider for valuable jewelry, musical instruments, or artwork.

Many people aren’t aware the buildings insurance on the structure of their house or home can actually cover more than just the building.  While home insurance or buildings insurance does not cover items inside the house like your clothing, electronics, or household goods, it can cover many house-related items such as:

•    Permanent fixtures in your home.  These can include things like kitchen surfaces, basins, baths, showers, and taps.  It can also include items inside the home that are permanently affixed to it, such as built-in bookshelves and wardrobes. 

•    Outside structures associated with your home.  Things like a gate, fence or boundary wall, attached garage, pool, spa, even drives and paths can all be covered under your buildings insurance.

•    Temporary housing or accommodation.  Should your home be uninhabitable due to a covered loss (typically subsidence, flooding, fire or theft), your policy typically pays for a temporary place for you and your family to stay while your home is being repaired or rebuilt. 

House insurance is typically designed to cover a “big ticket” loss whose cost would be beyond the capacity of a normal person to have in savings.  Many insurance companies offer a “claim free” discount to encourage people to avoid claims on their buildings insurance unless absolutely necessary. 

Cover for the items inside your home like furniture, electronics and clothing is typically provided by contents insurance, which usually costs less because the value of these things, even all together, won’t rise to the value of your house and associated items.