Home insurance is a must for anyone who owns a property and while no one wants to imagine something bad happening to their home and all their earthly possessions, this is always a possibility and if it should happen, you need to be prepared. For those considering opting for home insurance, there are certain things that you simply have to be aware of before you sign for a specific policy.
Remember, the more you learn about the different types of policies on the market, the better informed you’ll be for when the time comes to pick out a package that just might be a life saver a few years down the line.
What Types of Home Insurance Cover Can I Choose From?
When it comes to home insurance, you’ll usually be able to pick from either building cover or contents cover. The building cover will pay out in the event of structural damage – such as damage to the physical fabric of the property and even built-in appliances.
The contents cover, on the other hand, covers everything from your furniture to your electrical goods.
Should I Opt for Building or Contents Cover?
If you’re a home owner and you want peace of mind, it’s best that you apply or both building and contents cover – that way you can replace your worldly goods in the event that the worst should happen.
What Does Building Home Insurance Entail?
Building insurance will cover you for a variety of disasters, including floods, fire, storms, falling trees and malicious damage. It is important to remember that the type of cover you’ll get will depend entirely on your policy so make sure that you know exactly what it is included within it.
What Does Contents Cover Entail?
For those who are insuring the contents of their home, you can expect to receive cover for the following; theft, flooding, fire, vandalism and earthquakes, among other disasters.
Once again, the range of cover you will receive will depend entirely on the details within your policy, so you need to make sure that you read your terms and conditions very carefully.
How Much Home Insurance Cover Should I Get?
When you’re looking at how much home insurance you should apply for, it can be tempting to opt for the market value because this is cheaper than the rebuild value, but it is important that you consider the latter. This is because, in the event you’re paid out, you’ll want to have enough money to rebuild your house and this simply won’t be possible if you don’t have enough cover.
When it comes to calculating how much you need for contents cover, on the other hand, this can be a lot more difficult to calculate. You’ll need to go through each room and work out the value of the items within each one. The total will then leave you with the amount you should be insured for. Keep in mind that you’ll want to be as accurate as possible because if you undervalue this amount, you’ll end up with a lot less than it takes to refurnish your home.
What is Away from Home Insurance Cover?
If there are items that you often utilize when you’re away from home, such as a laptop or cell phone, you’ll likely want to have these insured under an “away from home” policy.
This type of policy will usually over everything within a person’s handback or wallet and is especially useful if you are often traveling away from home.
What is not Covered Under Contents Cover?
There are certain items that simply won’t be covered under a general contents cover policy and this includes items such as jewellery, antiques or even costly art pieces.
It is common for these types of policies to cover up to a certain amount, such as $40,000, and if you own items that are more expensive than this, you’ll be out of luck if you don’t have a separate policy for them.
Do I Need Specialist Cover?
There are certain types of properties that cannot be covered with general home insurance – these need a specialist cover.
Examples of these types of properties might be renovated windmills or those with a thatched roof. Keep in mind that you’ll likely end up paying higher premiums for these types of properties.
How Can I Lower my Monthly Premiums?
One of the fastest ways to lower your monthly premiums is to increase the excess. The excess is the amount you will pay in the event you make a claim, and the higher the excess, the lower the overall premiums.
Keep in mind that the excess should never be more than you will be able to afford in the event that the worst should happen.