In this article I take a look at the two different types of Home Insurance: Building and Contents – and whether it’s worth having both.
I also look at some more specialist types of Home Insurance such as Landlords and Students accommodation Insurance.
You’ve probably read the article title, rolled your eyes and thought, ‘Well obviously Home Insurance is insurance for your home – there, answered the question for you.’
But, what isn’t so obvious is what different types of home insurance are available, or why you might need it.
So, before you close this tab and head back to Instagram or cat videos on YouTube, take a look at this article – you might learn something you didn’t already know…
Why Should I Get Home Insurance?
Home Insurance, like other insurances, is put in place to compensate you with a cash payout – this time if there is any damage or loss to your property, or possessions within it.
If your roof was damaged in a storm could you afford to pay for the repairs? Or if there was a fire? If your home was uninhabitable because of a flood, could you afford to pay to live somewhere else?
And what if you were burgled? Could you afford to replace your flat screen TV? Jewellery? Your teenager’s X-Box?? (You’ll want to replace that quick, trust us).
The answer is probably ‘no’…but do you HAVE to have Home Insurance?
Is Home Insurance Compulsory?
The short answer is, no, but if you have a mortgage on your property your lender will normally insist that you have adequate Home Insurance.
Whether you are a homeowner or not, your home is your safe place, and where you keep your most treasured possessions; so, for peace of mind it makes sense to protect them.
Ok, so what insurance policy covers what?
What Does Home Insurance Cover?
First of all you need to know that there are two different types of home insurance; Buildings Insurance and Contents Insurance. You can also take out a policy that combines both.
What Is Buildings Insurance?
This protects the structure of your home, including the roof, walls, and windows.
It will not normally pay out for damage due to wear and tear, but will cover you against storm or fire damage, or any other structural damage to the property.
Protecting against something like flood damage can be a little trickier depending on the area where you live. I have covered that more in my article, ‘HOW MUCH DOES HOME INSURANCE COST?’
Another point that might be worth thinking about before you start looking at policies is whether or not your property could be classed as ‘unusual’.
If you don’t live in a standard brick walled, tiled roof house, then you might need specialist building insurance.
Some property styles defined as ‘non-standard’ include houses with a timber frame, and those with a flat roof.
If you live in a listed building or a cottage with a thatched roof then specialist buildings insurances are also available.
What Is Contents Insurance?
The contents of your home are probably worth more than you think.
It’s not just the TV and jewellery; what about the kids’ ipads? Those expensive games consoles? That painting hanging in the dining room that Great-Aunt Gladys left you?
And it’s not just the obvious stuff either – contents insurance covers furniture, carpets, and curtains. And don’t forget about those expensive shoes and handbags, or that designer suit you bought.
And what about the contents of the shed – how much was that petrol lawn mower worth? Or the golf clubs in the garage?
How Does Contents Insurance Work?
Contents insurance normally works on a ‘new for old’ basis, so if your TV is damaged, for example, your insurance policy will pay out for a new one.
Some policies take into account wear and tear, so if the TV was 5 years old the policy will only pay out its current value – not the price when it was new.
Do I Need Home Insurance if I’m a tenant?
Tenants don’t need to worry about buildings insurance – that’s the landlord’s job, but protecting your possessions will be up to YOU and as I said before, if you can’t afford to replace all those things if the worst was to happen, then it’s a must.
It’s probably also a good idea to extend your policy to cover any accidental damage to carpets and curtains etc.
Do I Need Home Insurance If I’m A Student?
If you or your child is heading off to university then it’s well worth looking into Student Contents Insurance.
You can add your child’s contents to your own insurance policy or have separate cover.
Either way, it will protect your/their belongings in case of fire, vandalism, or burst pipes. It’s worth remembering that you’ll need to take out separate contents cover if they are going to live in shared accommodation, and that you’ll need to make sure that you’re insured during the holidays as well as term time.
See also When to get Buildings And Contents Insurance When Buying A House
Who Else Should Think About Home Insurance?
Protecting your home and possessions doesn’t just apply to those who own or rent their homes. There are other instances where buildings and contents insurance is advisable. Such as:
1. Landlords And Home Insurance
It is your responsibility to make sure you are adequately insured if you are going to rent out your home, and it is important to protect your investment by having the structure of your property insured.
Contents insurance is important too, especially if you are letting a furnished or partly-furnished house.
2. Home Insurance If Your House Is Going To Be Empty
Going away for a while?
Purchased a new property but not sold yours yet?
If your house is unoccupied for more than 30 days it won’t be covered under a normal insurance policy.
Empty houses are a target for thieves, and there’s a risk of burst pipes etc. Unoccupied Home Insurance can cover these risks.
3. Home Insurance And Holiday Homes
Holiday homes need specialist cover because they are not occupied all year round. A Holiday Home Insurance policy will also cover your home if you decide to let it out to friends and family.
My article ‘How Much Does Home Insurance Cost?’ goes into more details about the costing of the various policies, and what things you need to take into account when calculating what your premiums will be.
Or why not drop me a line if you have any other questions – I’m always happy to help. If not, you can get back to your cat videos!