Your home is probably the largest purchase you have ever made. No doubt over the years you have invested time and effort to create just the right environment. Yet so much could be lost if inadequate or no contents insurance is in place.
The Christmas season is a peak time for accidents in the home and losses from thieves. Make sure you are fully protected and have replacement values up to date.
A staggering 24 per cent risk so much by not having contents cover even though the average annual premium is only £167, according to the Association of British Insurers.
Contents insurance should be taken out for all furnishings and personal belongings that are not permanently fixed.
It is particularly easy to overlook contents in a freezer and clothing and to under-estimate the replacement value of items bought many years ago.
Heirlooms are frequently undervalued. If, for example, paintings and silver have not been assessed recently, ask either a leading auction house or a member of the British Antique Dealers’ Association to give written descriptions with current values.
Some insurers give a discount if such valuations are obtained every five years. Sheilas’ Wheels will only insure jewellery worth over £2,500 if it has been valued every three years.
Photograph items and note all marks and serial numbers, such as on photographic equipment. Keep such documentary evidence away from the home, such as with a bank or solicitor.
When choosing your insurer, consider particularly:
n if ‘new for old’ applies (where no reduction is made for wear and tear with age);
n accidental damage cover (if a carpet has wine spilt on it, it is replaced if the stain cannot be removed);
n single article limit;
n belongings outside the home, such as when shopping or on holiday;
n adequate garden cover (for BBQ, toys, plants).
Hiscox, one of the higher networth insurers with a sensible approach to contents, says the top reasons for claiming are accidental damage, theft, water and fire. Direct Line, owned by Royal Bank of Scotland, says the highest proportion of furniture contents claims result from water escaping, such as frozen pipes.
Electronic articles are often claimed for as they are usually small and portable.
The most vulnerable items are computers and accessories, console games, consoles, DVD player and Hi Fi, according to Direct Line.
Some insurers expect you to calculate the replacement contents value whilst others offer cover on a blanket basis as standard.
Both John Lewis and More Th>n Premier offer total valuables of at least £30,000 as standard, which is not the case with Aviva, Saga or Sainsbury’s.
Check on individual value limits. Budget insurers have low levels that may be quite inadequate, such as for a piece of jewellery. By comparison, M&S Money’s policy, which is underwritten by AXA, sets £15,000 per article.
Some insurers insist that they nominate who is to replace items. This has two drawbacks as you may wish to upgrade (as with a television) and may prefer to choose your own (as with a subjective area like jewellery).
Such information is not given on price comparison sites.
Home emergency cover on a 24-hour basis is offered under some policies. This means that if a pipe bursts at any time, the insurer will find a reliable tradesperson to carry out emergency work and contribute towards parts and labour.
Winter weather can certainly cause problems with M&S Money revealing that claims have jumped 200 per cent in three years.
It recommends insulating pipes and leaving heating on a low setting at all times in freezing conditions.
Consider how much protection you need outside the home. This can bring a saving on travel cover as luggage need not be insured again, although a contents home policy will not pay for delays, only for loss. Up to £25,000 of possessions can be covered anywhere in the world with John Lewis.
It is also a useful way to cover belongings taken by a youngster to university. However, they may not be covered for vacations when the student is absent.
With many homes increasing their possessions at this time of year, check if additional cover is included as part of the policy. The Post Office, which has a panel of insurers, offers an extra ten per cent cover during Christmas and weddings whilst Direct Line increases contents values by five per cent as standard and by 20 per cent on its Home Plus policies until January 15.
There are some great offers currently. Direct Line is reducing premiums by 25 per cent plus a further 25 per cent online until January 3.
Don’t double up on cover. Research for esure shows that 23 per cent buy insurance that they already have, such as for loss, damage or theft of a piece of jewellery, but purchase it again when buying a new article.
Every 37 seconds a home is burgled in the UK. A burglary claim may be refused or the payout reduced if:
n door locks and other security is incorrectly stated (final exit door should be fitted with a mortice deadlock conforming to British Standard 3621);
n theft is unreported to police and no crime number assigned;
n property left unoccupied for over 30 consecutive days;
n windows left open or unlocked.
For protection, install an alarm and have a clearly visible alarm box. Fit an outdoor security light with a motion sensor at the front and rear. Sheilas’ Wheels recommend tall, thorny plants to the rear of borders and close to fencing but suggest planting trees some distance away so that they cannot be climbed to give access to upper windows. Consider a gravel drive which will generate noise when a vehicle or person approaches the home.
Lock away useful tools and equipment that could help a burglar, such as drills and ladders.
Fit good quality locks to sheds and outbuildings. Fit timers to lights and radios and buy a home safe.
If snow falls and you are away, ask a neighbour to walk your path to suggest the house is inhabited.
Some police forces have crime prevention officers who will visit and give free advice.
Some insurers deliberately tailor contents policies for certain age groups, such as Rias (part of Fortis UK) and Saga (owned by Acromas) for the over 50s, aware that home owners are less likely to be out during the day.
Some firms offer no claims discounts. Churchill starts after just one claim-free year and increases the rate to 15 per cent after five years.
Rias discounts up to 35 per cent when claim-free for five years or longer.