Buildings Insurance
Having suitable home insurance will be a condition on your mortgage when you take it out. You do not have to take out your policy with your building society/lender, unless you have agreed to a special mortgage package, which includes their own insurance.
The 'sum insured' is the maximum amount the insurance company can pay you. It must be the full re-building cost of your property. The exact amount you will need to cover your property can be found on your valuation report you would have received before you moved in.
Any significant under-insurance could mean that your claim might be reduced or even rejected altogether.
Contents Insurance
Contents policies also have other sections such as liability insurance, legal expenses and freezer contents to cover those extra risks likely to happen. Usually to have these sections added to your policy may require an extra premium.
A wide range of contents policies is available. The cheapest of all is the 'indemnity' policy. This takes into account the amount for wear and tear. So, if your five year old carpet was ruined by leaking water, the pay-out would reflect the age of the carpet.
Costing a little more is the 'new for old' policy. With this policy you will be paid the full cost of a brand new carpet to replace the five year old one.
Cost
Your postcode is important both for buildings and contents insurance. Insurers may find that your postcode area is more prone than others to subsidence damage, or the losses from theft or winter weather.
Some insurers operate a no-claim discount system when policies are renewed with them. Check on your renewal notice to see if this applies.
Extra Cover
You can add onto your policy 'accidental damage' which could come in useful if your 3-piece suit was accidentally damaged by paint or by such things. If you want to widen your cover to 'accidental damage' then an extra premium will be payable.
'All Risks' is cover for any household items you regularly take out of the house, binoculars, cameras etc. These can be listed in the policy under an 'All Risks' section, again an extra premium is payable.
Liability
Householders - like everyone else - must exercise reasonable care in everything they do. If you are careless or negligent, and cause damage to someone else or their property - then you could be held 'legally liable' - perhaps for a great deal of money. Contents and buildings policies cover you against this risk. The buildings policy covers you as owner of your home while the contents policy covers you as its occupier.
Claims
Read your policy and make sure that the loss you have suffered is covered by your policy.
Decide which policy, buildings or contents, to claim under. If you are not sure, telephone your insurance company for advice. Your policy booklet gives you a contact number.
You will need to request a claim form from your insurer, which will need to be completed as soon as possible. This needs to be sent back with your estimates for the costs of repairs/replacement.
If you have a 'replacement as new' policy you can claim for the full cost of repairing your property or replacing it with new items if they've been stolen or destroyed.
If you have an indemnity policy then you must deduct, on your claim form, an amount to represent wear and tear.
If you find it difficult to get estimates quickly then send the claim form to the insurance company straight away, and tell them the estimates will follow shortly. If you have suffered from theft, malicious damage or vandalism, tell the police immediately.
If you have lost credit cards or cheque cards, tell the company that issued them immediately, a delay of even a few hours could prove expensive for you.
If temporary repairs have to be done to prevent further damage, arrange for the work to be done and keep bills. This maybe included in the overall costs of the claim.
It is important to keep damaged items because the insurance company may want to see them. Burnt or soaked property can be kept in a shed or garage.
As soon as the insurance company gets your estimates it will either:
Pay your claim.
Arrange for a claims inspector to call on you.
Send a loss adjuster to handle the whole claim.
Pay your claim
Loss adjusters are independent experts with a good knowledge of the area in which they operate. They are skilled in assessing claims and in advising on the best repair and reinstatement methods. They will recommend to the insurance company the way in which your claim should be settled.
There is usually no need for you to appoint someone to act on your behalf. If you do, remember you will have to pay their fees yourself.
Insurance companies usually want to see evidence of ownership and value of property which has been lost or damaged. It is important to keep, if possible, receipts and professional valuations. If you do not have these, ask the insurance company what other evidence they will accept.
Many insurance companies provide telephone help lines for policyholders facing an emergency. They can give you the names of good tradesmen for emergency repairs and, of course, give detailed advice to those having to make a claim.
Security
Some insurers require the installation of approved alarm and/or minimum-security fittings. Check whether this applies. You may qualify for a discount from the premium if you already have good security.
Insurance policies these days are easy to read. There is no 'small print' and many of them have won plain English awards. It is advisable that you check your policy immediately and make sure you are adequately covered!
