A standard home contents insurance
policy will cover everything that you would be able to remove from your current house and put into a new one – from shoes and clothing to sofas and curtains – but there are some exceptions that could prove particularly costly to replace.
For instance, if you have any items of significant value, anything from antique ornaments to photographic equipment, then most insurers will require you to insure them separately as single items. They will not be covered under the basic terms of your policy.
Here we’ll take a look at how home insurance works, find out what typically constitutes a ‘valuable item’ and offer some tips on insuring high-value equipment.
Calculating the cost of your contents
Although, unlike car insurance, home insurance is not a legal requirement, it is recommended that you take out cover so that you are not left to pick up the cost should you lose any of your possessions to fire, flood or burglary.
Unfortunately, the best way to ensure that your insurance policy covers everything you need it to is to go through your home, room-by-room, and make an inventory of your possessions, including valuations, making sure that you neither over-estimate or under-estimate how much your contents cost.
Under-estimating the value of your contents could leave you short as, aside from the fact that the value of your claim won’t be enough to replace everything you’ve lost, you could find that your insurer will only pay out a percentage of the claim, which could leave you well out of pocket.
On the other hand, over-estimating the value of your possessions could mean that you are paying over the odds for your premium unnecessarily.
Thankfully, the MoneySupermarket home insurance calculator gives a room-by-room breakdown, including outbuildings, and offers reminders for things you may have overlooked.
And once you’ve done this, you can then move onto pricing up those more expensive, single items – such as those you may use for your hobbies and interests.
Singling out your valuable items
Although things like televisions and computers are usually expensive items they will be, more often than not, covered under the terms of your contents cover. This is because most homes will contain these items and so they are classed as household furnishings and not valuables.
And while most policies will include some kind of cover for valuable items as standard, they generally come with an upper limit which can be as low as £1,000 per item. In this case, you should always check your policy to see what is covered and for how much.
In addition, even though your policy may offer ‘unlimited’ contents cover, it could still impose limits for valuables behind this claim. So if you have £20,000 worth of ‘valuable’ items but are only covered for £15,000, that’s quite a shortfall to plug.
The sorts of things that you usually need to obtain additional cover for are items such as; jewellery (including costume jewellery and watches), cameras, camcorders, paintings, expensive sports or music equipment, antiques and any items made from precious metals such as gold or silver.
In short, anything of high value that could be deemed as non-essential to the household – even if it is essential to you and your hobby.
So if you are a musician, you will have your instruments insured against accidental damage, theft and loss and, if you play outside of the home, you may want to add instrument and equipment breakdown as well as public liability insurance.
If you are a keen cyclist and have an expensive bike then you may want to take out specialist protection that includes roadside recovery in case you suffer a buckled wheel or similar mishap while out and about.
You’ll also need to remember to tell your insurer if you keep your bike – or any other expensive sports equipment for that matter – in an outbuilding when not in use, as this will also affect your cover.
And if you need any of these items to be covered when away from the home then you may need to take out additional personal possessions cover.
Tips on insuring your valuable items
When insuring any high value item always ensure you are covered for the full market value or the cost of a replacement and take out ‘new for old cover’ where appropriate. For instance, if you have an expensive camcorder that is a couple of years old, you may want to take out new for old cover so that you are given a comparable model, rather than a replacement that is worth the current value after depreciation is considered.
If you are insuring any antiques, paintings or precious metals, then keep in mind that their value can fluctuate and so you should get regular, professional valuations.
If you’re insuring any paintings, remember that the death of the artist could see its valuation rapidly increase, so make sure that you are covered for such an eventuality.
Always keep documentary evidence of any valuations as well as purchase receipts of any high value items you have insured. And it’s also a good idea to keep photographs of any items as this can help insurers, and the police, should they be stolen.
The best way to make sure you’re getting the best deal on your home buildings and contents insurance is to shop around on a price comparison site. MoneySupermarket compares quotes from almost 100 insurers to help you get the right cover at a price you can afford.
Follow Les on Twitter @LesRobertsMSM
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