In one form or another, home insurance has been around for hundreds of years. We’ve come a long way, however, since the ‘fire marks’ of the 18th century, when fires were much more common, and were the only thing most homes were covered against.
Back then, it was seen as a luxury only afforded the very rich – but today, it’s available to all homeowners and covers almost every conceivable household risk.
We all know the basics when it comes to home insurance, of course, but here, we’ve decided to dig a little deeper. Below, we’ll examine a few of the facts that often get swept under the rug.
By doing so, we can hopefully ensure homeowners everywhere are informed enough to make an insightful decision the next time their insurance renewals roll around.
1. Of the 22.6 million homes in the UK, 5 million of them are completely uninsured. That’s almost 1 in 5. Given that the average premium (including contents cover) only costs around £309 a year (around a fiver per week), it would appear that the 42% of those who don’t have insurance who claim it’s too expensive might be doing a little more gambling than they’d like to admit.
2. The most common claim is for water damage (around 28%), with storm and accidental damage (19% and 17% respectively) coming in second and third place. The average insurance claim for a burst pipe (one of the most typical accidents that lead to a claim) is £25,000. Note that floods and earthquakes are rarely covered under home insurance, and will require supplemental cover.
3. Putting decent security measures in place can go a long way towards reducing your premiums. A working smoke detector is a given, but if you also install deadbolts on your front, and rear doors and a good home security system, you can reduce your premiums by as much as 20%.
4. Whilst home contents cover often will take into account your expensive belongings, it might not be enough for exceptionally expensive items. If you keep any particularly expensive jewellery in the house, for example, your insurance might not cover them (at least for how much they are actually worth) if they are stolen. For these items, supplemental insurance is often required.
5. Keep accurate and up-to-date records wherever possible, as if you have verifiable receipts and appraisals to hand it will make claims run much more smoothly. It’s always a good idea to have a ‘home inventory’ of your belongings backed up by a video tour..
6. There could be a time limit in place for reporting a problem with your house so don’t delay if you spot a problem. This is especially relevant in water damage situations, which can lead to lasting problems (such as mould).
7. Your credit score might affect your premium. Indeed, one study found that those with poor credit could be paying 100% more for home insurance. So, this is certainly something to take into account when shopping for home insurance.
8. Many home insurers will deny a claim if they feel that any damage has occurred as a direct result of neglectful homeownership, or poor maintenance. As such, it behoves all homeowners to make sure that anything within their control that could potentially lead to a problem is taken care of. This includes trimming any trees that are getting too tall, keeping an eye on the roof for leaks, and watching for unforeseen spikes in your water bill (that could point to a leak).
9. Not all home insurance policies are created equal. Shop around before deciding to go with your existing provider for convenience. The popularity of price comparison websites has made comparing insurance prices easier than ever before so take advantage.
10. Finally, there are certain situations where it’s better to hold off on making a claim. Making a claim will always increase your premiums and it’s been proven that those who make one claim are more likely to make more claims in the ensuing years.
So, next time disaster strikes, instead of making a snap decision and contacting your home insurance provider, weigh up the finances and ask yourself if making a claim would be in your best financial interest?