Home Insurance: What to Look for and How to Save

Published On : 06/17/2021

Having home insurance gives you peace of mind that your home and its contents are protected should you experience unexpected events like floods and fires. But before you sign on the dotted line, you need to know what to look for in a policy. You also need to be aware that there are several ways in which you can save money on your home insurance.

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Compare Different Insurers to Find the Right Home Insurance Coverage

One of the best ways to save money on your home insurance is to shop around. Home insurance policies and prices vary greatly. So, when you compare home insurance policies for both building and content insurance, you will be much better positioned to get a good deal. However, you should not choose an insurance company solely based on the price. Lower prices often mean more policy exclusions. It is important you are covered for everything you want. You also need to ensure you are not paying for any additional and unnecessary expenses. Never make assumptions about what elements are included in a policy. You may think some features are standard, but with many insurers, they are optional extras. For example, the following features are typically not included as standard in most home insurance policies:

•   Coverage for when you take personal belongings outside of your home.
•   Coverage for comprehensive accidental damage.
•   Coverage for emergencies.

Work Out How Much Building Insurance You Need

Home insurance falls into two primary categories: building and contents cover. Building insurance covers your home’s structure; elements like the walls, windows, and roof, and sometimes permanent fixtures like a fitted kitchen or bathroom. Building insurance is important in case of things like burst pipes, falling trees, storms, floods, and fires. The amount of building insurance needs to be enough to cover the rebuild of your home. For instance, should your house tragically burn to the ground, the insurance should pay the cost of rebuilding the property. Before choosing a home insurance policy, ensure you work out the rebuild value. It will not be the same as the current market value of your property.

Work Out How Much Contents Insurance You Need

Perhaps just as important as the property’s structure is the stuff inside your home. The contents of your home need to be insured against things like theft, floods, fires, lightning, explosions, and water leaks. Most people do not think their home contents are worth as much as they are, but an average family of four has contents worth around £25,000. You need to know how much your contents are worth so you can be sure the cost is covered should you need to claim on the insurance. So, spend time walking around your home, room by room, totting up how much all of your personal items are worth. That includes iPods, laptops, jewellery, clothing, carpets, curtains, and furniture. Most insurers limit the pay-out for single items. For instance, if the single item limit is £1,000 and a necklace worth £1,500 is stolen from your home, you would end up with a £500 shortfall. So, it is vital you know the worth of your contents and what the policy limits are before you choose which home insurance provider to go with.

Ways of Saving Money on Your Home Insurance

In addition to comparing insurance companies to get the best deal and calculating the costs of a rebuild and your home contents, there are other ways you can save money on your home insurance.

Increase Your Home Security

You can get a better deal with some insurers when you have additional security features in your home, such as certain approved locks on all of your windows and doors and installed security lighting. Having approved burglar alarms and smoke alarms installed can also reduce your home insurance costs. Quite simply, the more steps you take to personally protect your property and its contents, the cheaper your home insurance policy can be.

Purchase Building and Contents Insurance Together

Many insurance companies provide discounts when you purchase both building insurance and contents insurance at the same time. Getting both types of policies through one insurer also provides you with less hassle if you need to make a claim for something that affects both your building structure and contents, such as a flood or fire.

Pay Annually

Most people pay monthly insurance premiums, but you can substantially save if you change to paying annually. Monthly premiums typically cost around 6% more than if you pay the amount in one go once a year. So, compare different insurers to see if you can save money.

Look Around for Offers

Some insurance companies guarantee that they cannot be beaten on price. If you get a low quote from one insurer but want to go with another insurance company that is asking for a higher price, see if the latter guarantees to match or beat any quote.

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Wanda Rich

Wanda Rich has been the Editor-in-Chief of Global Banking & Finance Review since 2011, playing a pivotal role in shaping the publication’s content and direction. Under her leadership, the magazine has expanded its global reach and established itself as a trusted source of information and analysis across various financial sectors. She is known for conducting exclusive interviews with industry leaders and oversees the Global Banking & Finance Awards, which recognize innovation and leadership in finance. In addition to Global Banking & Finance Review, Wanda also serves as editor for numerous other platforms, including Asset Digest, Biz Dispatch, Blockchain Tribune, Business Express, Brands Journal, Companies Digest, Economy Standard, Entrepreneur Tribune, Finance Digest, Fintech Herald, Global Islamic Finance Magazine, International Releases, Online World News, Luxury Adviser, Palmbay Herald, Startup Observer, Technology Dispatch, Trading Herald, and Wealth Tribune.