What is home insurance?

There are two types of home insurance available in the UK. These are buildings insurance, which cover the actual structure of the house and anything which is permanently connected to it, such as the bathroom or kitchen fittings; and contents insurance which cover anything which can be easily removed and taken away. Therefore, although a permanently fitted wall covered could be covered under a buildings policy, carpets or freestanding storage units fall under contents cover. When there is damage to a property there is often damage to contents as well so it is usually a great advantage in buying both home and contents cover from the same insurer and this is often the cheapest option too.

People who have mortgages outstanding on their homes are invariably expected by the mortgagor to at least insure the building, since this represents their security. Mortgagors very often suggest that their borrowers use particular insurance companies (which, as like as not, give them a commission on the business) but these are rarely the best deals available and it is illegal to insist that the borrower must buy a policy from them.

What is normally covered?

This is spelt out in the policy documents which should be read very carefully by every buyer. The overwhelming majority of complaints about insurance companies are caused by misunderstandings about what is, and what is not, covered and most of these could have been avoided if the homeowner have studied the policy correctly.

The majority of policies will cover a house against such risks as lightning strikes, flood, fire, storm and tempest, subsidence, ground heave, landslip, and falling trees or branches, impact by vehicles, or damage through leaking pipes. It should never be assumed however that these risks are always covered by every policy; for example in areas which are prone to flooding or subsidence, some insurers may refuse to cover this risk or may attach special conditions. This is another reason why the importance of reading policies very carefully before agreeing to them cannot be overstated.

Often an insurance company will stipulate that they will only make payments for certain risks as a compensator of last resort. In other words, if your house was hit and damaged by a car, your insurer could expect you to make a claim against the driver's car insurance first, and only claim against your home insurer if you were unable to obtain full satisfaction.

What is normally an optional extra?

You may well have a garage or other outbuildings, boundary walls, gates, fences, paths and driveways etc. Some policies may include cover for these, some may list them as optional extras. A risk called 'trace and access' may also be an optional extra, and this refers to the cost of finding a fault, and then making good after the fault has been fixed. For example, you may have a leak in a pipe behind some tiling in your bathroom; the insurance company may well pay for repairing the leak, but would not normally pay for removal of tiles and plaster which could be necessary to find the leak, nor for necessary replastering and re-tiling afterwards. Similarly, they may well pay for clearing a blocked drain, but not for digging up half of your drive in order to find the blockage, and then re-laying it afterwards. If, however, trace and access cover is in place the insurer would normally be liable to pay for all reasonable costs.

Damage caused by frost or other causes to external pipes, drains, cables etc may also be optional extras which are not included in some standard policies.

What is normally not covered?

Many insurance policies specifically exclude losses which are as a result of riots, terrorism or acts of war. Damage caused as a direct result of lack of maintenance can sometimes be excluded (which means that if you persistently fail to fix a damaged roof, your eventual claim for new ceilings may well be refused), as can problems caused by routine wear and tear, or deliberate damage by members of the household.

it is usually a condition of most policies that you inform your insurer of every problem and obtain their authorisation before going ahead and putting right any damage, or replacing any losses. This means that you cannot assume that you can make whatever contracts you wish with whomever you wish; if for instance you were to authorise a plumber to dig up an expensive drive to locate a broken pipe and this work was found to be unnecessary, or if you bought an expensive item to replace a cheaper one which had been damaged or stolen, without in each case obtaining the permission of your insurer, you could well find most of your claim refused.

Contact us   Our Privacy Policy   Disclaimer

Copyright houseandhomeinsurance.co.uk 2011