Purchasing home insurance may be regarded as essential when you are trying to protect your investment.
In fact, it might be actually obligatory if you have a mortgage on the property concerned. That’s due to the fact that your mortgage provider probably has a clause in your loan agreement which obliges you to maintain full buildings insurance on the property at all times.
However, here at GSI Insurance we are keen to try and offer some general advice and guidance in this area. So, we have put together a few very basic thoughts below that you might find useful when selecting home insurance.
Be clear what you mean by home insurance
In some cases, this term can mean very specifically “buildings cover”. That is the type of policy which protects your bricks and mortar from the financial consequences of things such as fire and flood etc.
In some cases though, home insurance can also mean simply cover for your contents. It might also be a general term used for a policy providing both types of cover (sometimes known as combined cover).
When you are looking at a headline price for a policy described as “home insurance”, you need to be clear that you know exactly what cover it is providing.
Read the policy carefully
Even in situations where you understand the general nature of the policy, you must make the effort to read it carefully to be certain of the specific financial protection it offers you.
Contrary to what some people believe, not all home cover policies are identical.
They may contain significant differences that may or may not be important to you in your unique circumstances. Find some time and be sure that you have read through the cover details thoroughly before deciding whether or not to purchase the home insurance cover.
Specific points to consider
The limited space here doesn’t permit us to go into great detail but here are just a few samples of areas where home insurance policies may vary one from another:
- subsidence – some policies include this automatically but others do not;
- flood protection – what is on offer here may depend upon where you live and whether or not a policy offers what is called the “Flood-Re” scheme;
- garden areas – you may find that some policies exclude outbuildings and garden walls etc. If you are happy with that fine but if not, you may need to think again;
- contents protection – some policies have very strict and low limits on maximum pay-out levels whilst others are more generous;
- excess – policies typically specify an amount of money that you’ll be expected to pay towards the cost of any future successful claims. There is a relationship in that typically, the higher the excess level specified, the lower premiums might be for a given policy. It’s important to be sure that you understand and are comfortable with the amount of excess specified by your policy as well as its relationship to the premium you are paying.
There are many other such factors that need to be considered before deciding upon home insurance.
We welcome your contact and further enquiries if you would like more help choosing the most cost-effective and suitable home insurance solution for you.