Insurance policies vary considerably. The price will change depending on the area in which you live. Believe it or not you can pay up to three times the price in one area over another, according to recent research by the AA. Also the amount of coverage and what exactly is covered varies from policy to policy.

You need to request information from several different home insurance companies. Work out what your requirements are, i.e. what would it cost to replace everything in your home (include everything including clothes, furniture, carpets, computer, stereo, TV)? Tally up high value items like jewellery separately. You then need to request quotes from a shortlist of home insurers, making sure that you give the same information to each company. Compare home insurance prices from your shortlist.

Make sure you understand whether each insurer can offer the level of cover you are after - some home insurers have a cap.

Check also whether they put a cap on single items, or speciified high value items.

What is the excess amount on each policy?

Check whether each policy offers additional areas of cover - i.e. accidental damage, liability insurance - and do they include this in the quote or is it charged as an optional extra?

Is there any discount by having buildings insurance and home insurance with the same company?

 

In fact neither are compulsory. Having said that your mortgage company may insist that you have buildings insurance and/or home insurance in place under the terms of their contract with you. Usually they insist on you having just buildings insurance in place - they don't want your home to fall down in a disaster, otherwise bang goes their collateral on the home loan.

 

It is better to be safe than sorry - it is generally inadvisable not to have both home and buildings policies in place.

Obviously the main structure of the home. If it were to fall down, buildings insurance would cover the cost of rebuilding. It will also cover any permanent fixtures in your home like inbuilt wardrobes, light fittings, cupboards. It will cover kitchen benches, taps, basins, baths. It doesn't usually cover items that can be easily removed and put into a new home like standalone wardrobes.

 

Check your policy to ensure that any outbuildings (garden shed or garage) you have are also covered. Some buildings insurance policies do not cover exterior walls, gates, pools, drives and paths. Will your policy pay for you and your family to stay in temporary accommodation while your home is being repaired or rebuilt? The policy should normall cover major risks like subsidence damage and fire.

Most other things not covered by buildings insurance. The home insurance policy should cover everything that you would normally be able to take with you to a new home. We mentioned several items above. All your furniture, computer, audio and visual appliances, personal belongings, even the food in your freezer. Don't forget your DVDs, videos and CDs. Your valuables will be included up to a specified limit - remember you may have to itemize these separately on the policy.

 

Home insurance cover will protect you against damage or loss to your home contents caused by theft, fire and flooding. Usually the items need to be be damaged or lost while in the house. Sometimes policies include loss or damgage to possessions taken away from the home - for instance your video camera. But more often than not, this requires an optional extra level of cover to be taken out at extra cost. Most home insurance policies also pay out for accidental breakages. If it is included in the standard policy, check whether there is a specified list of allowable items. For instance a glass table top might be covered, but not a smashed television.

 

Almost definitely if your bike was on your property when it was stolen. If the bike was stolen away from your property, it probably won't be covered under the average standard policy. Sometimes you can add this feature as an optional extra to the home insurance policy.

First let's look at buildings cover.

You will be asked by the insurance company to specify what the cost of rebuilding your home might be from scratch (assuming the worst i.e. home destroyed by fire). You can get an idea of this cost from your mortgage agreement or your title deeds. If you had a survey done on your home, you may have the figure listed on this document.

 

Working out your contents cover requirements may take a little longer. You need to get a notebook and a pen. Walk around your home from room to room. Methodically list each room as a heading and under each note down every item in it. We have listed examples of items above - don't forget anything, even plants, curtains and bed covers. Subtotal each room, then add the room subtotals. On top of this add any valuables i.e. jewellery, paintings separately. This is your total home insurance cover requirement.

Extra Protection: Always check what comes as standard and what is available as an optional extra, especially when comparing like-for-like policies. The cheapest policies will not normally add in as standard items like Legal Protection, Accidental Damage, or Extended Contents. Assess whether you do need this extra level of cover. Can you afford to pay out for a new glass table top for instance? Or a new bicycle?

As we mentioned above, first assess your requirements, then draw up a shortlist from companies that you see advertising in the newspapers or on the internet. Some insurers will offer up to 10% discount for policies taken out online, as their administrative overhead is reduced.

Check whether you get additional discounts for:

* buying both content insurance and buildings insurance together;

* No claims period

* Being part of a neighbourhood watch scheme

* Having a burglar alarm fitted

* Having approved doorlocks and keylocks on the windows

* Increasing the standard excess

 

If you haven't heard of the company, do some further investigation. You really do want good customer service, should you have to make a claim. Try and find out about the company's reputation. Do you know anyone who has a policy with this company? Talk to them to find out about their experience. Try ringing up the company's claim line. Are you put on interminable hold? Do a search on the net for forums where people talk about their experience with home insurance companies. If in doubt, go with the more reputable, if slightly dearer, firm.

 

In most cases you should be free to switch to an insurer of your own choosing. It is a simple exercise to call up your mortgage company to ask.

 

Most people do go with the insurance arm of their mortgage provider, purely because it was 'organised' by them at the time of taking out the mortgage. Beware, it is often not the cheapest option and you are always advised to compare other home insurance providers. You may be surprised how much you can save.

 

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