Home insurance explained
Is it time to renew your home insurance? Or maybe you’re looking to get your very first policy?
Either way, you’ll have to get your head around some of the jargon used in the world of home insurance. Excesses, exclusions, contents, buildings… It can get a bit confusing.
But don’t worry. This article should help you make sense of it all – and hopefully help you find the policy that’s 100% right for you.
Understanding the basics: building insurance vs content insurance
The first thing to know is there are two main types of insurance. They each cover slightly different things, but they’re often bought together as ‘buildings and contents’.
As the name suggests, this policy covers the structure of the home. The walls, the roof, the foundations, and so on. But it also covers permanent fixtures and fittings like sinks, toilets, garage and fitted kitchen.
This covers everything else. One useful way of working out if something falls under buildings or contents is to imagine what you’d do when moving home. If you’re likely to take something with you – e.g. furniture, gadgets, clothes, appliances – that’s contents.
Do I need buildings and contents insurance?
That depends. If you own your own house, then the answer is almost certainly yes.
But if you own the leasehold on a flat, maybe not. Buildings insurance might be the responsibility of the freeholder. It’s always a good idea to double-check this with a solicitor though – any mistakes could be expensive!
Also, if you rent your home, you probably won’t need buildings insurance. It’s usually something for your landlord to sort out. You’ll just need contents insurance to protect your own personal belongings.
Good to know – some other insurance terms explained
Accidental damage cover
What happens if you drop something heavy on that expensive kitchen worktop? Or if your ceiling gets ruined by an overflowing bath upstairs? Accidental damage is an optional add-on that can be great to have. But always check the small print – not every kind of accident will be covered.
Personal possessions insurance
Your personal possessions will be covered by your insurance when they’re at home. But once you’re out and about, you’ll usually need extra cover to keep them protected. It’s especially worth considering for pricey things like jewellery, laptops and bikes.
This is the bit of the claim that you agree to pay for. For example, if your policy has £250 excess and you need to claim for £750, the insurance company will pay out £500 and you cover the rest. In general, the higher the excess the less you pay for the policy.
Exclusions in insurance
Aka the small print. Every insurance policy describes what is and isn’t covered – often in detail. The exclusions are those things that aren’t included in the policy (e.g. high-value items, or damage caused by wear and tear). Make sure you’re aware of them before buying the policy.
Most insurance policies automatically cover things worth up to £1,000 – but anything worth more usually needs to be specified when you take out the policy. And if you later buy something worth over £1,000, you’ll need to contact the insurer and add it to the policy. Find out more about how to protect your high value items.
Legal expenses cover
Insurance is all about protecting yourself against unpredictable – and expensive – events. Many insurers offer the option to take out cover for legal expenses, which can really help if you ever get involved in a personal injury case, for example, or even an employment dispute.
Home business insurance
If you use your home as a business address, you’ll need to declare that when taking out insurance. But what about working from home? The good news is, doing normal office work at home shouldn’t affect your insurance – but ask your provider if you’re at all unsure.
Ready to find the right insurance for you and your home?
British Gas offers a big range of building and contents insurance with all sorts of optional add-ons that help you protect what matters most to you. Find out more and get a quick personalised quote here.