What is contents insurance?
Contents insurance – or home contents insurance – can help to protect the contents of your home in case they get lost, damaged or stolen.
Contents cover can also protect your valuable possessions from damage caused by events outside your control, such as fires, theft, storms, floods, movement of the ground below the property – subsidence - and water leaks.
What does home contents insurance cover?
Typically, items covered by a home contents insurance policy include furniture, clothing, electrical items like televisions and laptops, money and jewellery.
Certain items might fall outside standard cover, such as expensive bikes, computers or music equipment. It may be wise to insure those items separately, unless the policy you choose has a high single item limit.
Essentially, if you could pick the item up and remove it from a room, it might be worth insuring. Contents insurance can also cover fixtures like carpets, rugs and curtains.
Why get contents only insurance?
Contents only insurance can be a good option if you already have a home insurance policy that covers the building structure, but you’d like peace of mind that the contents inside the house are protected too.
And if you’re renting a property, the actual buildings insurance and fixtures that come under contents insurance should be covered by your landlord, but you might want to consider taking out contents insurance for your own valuables, including laptops, bikes and more.
How much does contents insurance cost?
The average cost of contents insurance is £55, according to MoneySuperMarket data from January – June 2018. But the price of contents insurance varies by region. Take a look at the average contents insurance cost across the country:
Newcastle upon Tyne
Tips for cheaper contents insurance
Having the right level of cover for all your contents is important, but there are steps you can take to help make your contents insurance policy cheaper:
- Shop around: premiums can vary considerably between insurers, so it's important to review quotes. Make sure you check ‘like with like’ – and be clear about the level of cover you need. Don't forget to shop around at renewal too, as your existing insurer will not necessarily offer the cheapest quote.
- Pay your premiums annually: many insurers will levy an additional charge if you pay by monthly direct debit. If possible, try to make a one off, annual payment.
- Cut out the frills: if you don’t need any added insurance extras, you could reduce your premium by choosing basic cover only.
- Raise the excess: most insurance policies include an 'excess', which is the amount you pay towards any claim. If you agree to increase the excess you will usually pay a lower premium.
- Combine contents and buildings insurance: if you have to buy buildings insurance for your home, it is often cheaper to buy both buildings and contents cover from the same insurer.
- Build up a no claims discount: insurers will usually reward people who have not made any claims with a cheaper policy premium.
- Think about prevention: it often pays to take precautions against a claim. High quality locks, burglar alarms, smoke alarms and membership of a Neighbourhood Watch scheme can all reduce your premiums.
The average cost of contents only insurance is £55 compared to the average cost of contents and buildings insurance combined which is £123, according to MoneySuperMarket data from January – June 2018.
Types of home contents insurance cover
There are broadly two types of contents cover. Most policies are called 'as new' or 'new for old', which means that if something is damaged, the insurance will pay the full cost of repair.
If something is stolen, the payout on ‘new for old’ policies will be enough to buy the equivalent new item. Check the policy details though, as some items - usually clothes - are not covered on a new for old basis.
Alternatively, you can choose an indemnity policy. Indemnity policies are cheaper because any payout is reduced to take into account wear and tear, or depreciation in value. For example, if your five-year-old laptop is stolen, the claim will be based on its current value, not the price when it was new.
How much contents cover do you need?
The 'sum insured' is the maximum amount the policy will pay out if the entire contents of your home are completely destroyed, so it’s important you get that figure correct.
A good approach is to go through each room slowly, making an inventory of all your possessions as they can add up to more than you think. Be sure to include items that are in the loft, or stored in an outside area such as a garden shed or garage.
Some insurance companies calculate the sum insured by counting the number of rooms in your home. But premiums can be higher and the sum insured could still be incorrect – which means you could be at risk that all your contents might not be covered if you haven’t declared them all.
And don’t forget to add fixed contents like carpets, curtains, fittings.
The most popular items consumers are looking to add to their contents insurance policy and the average cover value they think they’d need to protect each item, according to MoneySuperMarket data from January – June 2018.
Do you need additional contents cover?
You can pay more to cover more expensive items and add additional cover. The most common additions include:
- Accidental damage cover: if you accidentally break a possession, for instance knocking over a valuable ornament while doing the dusting, it will cover you.
- Accidental loss or damage cover for personal possessions that you take out of the home: if something happens to your possessions when you’re out, you could be covered - but you might have to declare which items you want to cover when you take out the policy.
- Extra cover for valuables: if you have any valuables, you may need extra contents insurance if their value exceeds the limit of your policy. For example, if the limit was £1,500 and your £2,000 engagement ring was stolen, the policy would still only pay £1,500.
- Home emergency cover: if you need any assistance or repairs because of a domestic emergency, this will pay out.
- Away from home: if your children are away at university, and they take their laptop or phone with them, you may be able to cover their items too.
It is 41% more expensive to opt for cover away from home for your home contents, according to MoneySuperMarket data from January – June 2018.
Compare contents insurance
You can compare contents insurance policies with MoneySuperMarket’s home insurance comparison tool. Select that you only want contents insurance cover for your home in step one, then enter a few details about yourself to make sure you get the right policy for your home set-up.
You can also add any laptops or bikes that might be worth over £350 that you want to insure, including their make, model and unique reference number to get the right cover for each item, plus any other items you want to insure that are worth over £1,000. You’ll also be able to say say if you want to add any extra cover for your contents outside the home, and you can include an estimate of how much cover you’d need to replace the entire contents of your home.
You’ll then see your contents insurance quotes, where you can add accidental damage cover for contents and change the voluntary excess to see how this affects the cost. You can also sort by provider, annual price and excess fees to compare contents insurance quotes and help find the right home contents insurance policy for you. It’s a good idea to read each policy document fully to see what you will and won’t be covered for before taking out contents insurance.