Do you know what your home insurance covers you for?
Published 23 June 2016 by Kyri Levendi
Make sure your claims aren’t rejected by checking what your policy covers you for.
More than one in five home insurance claims is unsuccessful, according to the Association of British Insurers (ABI). One reason for this is that people are confused about what home insurance covers.
Of those whose saw a claim rejected, some bought the wrong kind of cover while others tried to claim below the policy excess. To make sure you know what your home insurance covers, we’re going to take you through what to look out for.
What are you covered for?
Home insurance divides up into buildings and contents insurance. Buildings insurance covers the structure of your home whereas contents insurance covers your possessions.
Typically, buildings and contents insurance will cover you against damage or loss caused by a number of different factors. These include fire, earthquake, flood or theft. To find out the details of the cover you’ve taken out, check your policy documents.
There are extra add-ons that you can pay for to provide you with wider cover. We’ll take you through some of these below.
This covers any damage to your property or belongings that’s accidental. For example, a red wine spill on your carpet or a dropped and broken laptop would count as accidental damage. To find out more about accidental damage, check out our blog.
Legal expenses cover
Legal expenses cover will give you access to legal advice. It will cover the legal costs of claiming compensation if an accident wasn’t your fault. As well as taking out or defending legal action. You can find out more about legal expenses insurance here.
Home emergency assistance
This covers the cost of calling out a tradesman to deal with an emergency, for example a broken boiler. It will cover the repairs and labour too.
In some policies, these extras can come as standard so check yours to see what cover you have.
What is usually excluded?
Home insurance doesn’t cover everything. That’s why it’s important that read your policy so that you know what cover you have. Exclusions can vary between policies, but you usually won’t receive cover against:
• general wear and tear,
• damage caused by a lack of maintenance,
• mechanical or electrical breakdown,
• restricted cover when your home is empty for a long period or is let to tenants, or
• any amount over the limits stated in the policy.
When reviewing your policy documents, make sure to check your excess amount. This is the part of the claim you pay yourself and can vary depending on different sections of your policy. An insurer can reject a claim if it’s below the excess value – so it’s important that you know what that value is.
You should also make sure the buildings and contents sum insured is right. This is the maximum amount your insurer will pay out for a claim. Your contents should be insured for the cost of replacing them as new, whereas your buildings should be insured for its re-building cost.
Not sure how to work out the rebuild value of your house? Check out our blog.