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What Do You Know About House Insurance?

May 28, 2008
Understanding house insurance is important if you want to ensure that you take out the right cover to suit your needs. There is no set policy to suit every homeowner and so you do need to be aware of the different policies available.

Different House Insurance Policies

Generally there are two main types of house insurance. These include contents insurance and building insurance.

Contents insurance is designed to protect everything within the home that you have purchased and which you will take with you if you ever move. Televisions, stereos, computers and electrical appliances all come under contents insurance. Buildings insurance on the other hand protects the actual fixture of the home including the flooring, roof, fixed bath, sink and basins and fitted kitchens and bathrooms. It can also cover the outside of the property such as greenhouses and garden sheds as well as walls and paving.

As well as contents and buildings insurance, you can also get added extras too. Some of these extras include inflation guard, scheduled personal property, theft coverage protection and guaranteed replacement cost coverage. Inflation guard will increase your insurance as inflation increases. Scheduled personal property will protect against loss or damage to items such as stamps, coins, guns and anything collectable. Theft coverage basically extends the insurance to contents of a motor vehicle or trailer. Finally guaranteed replacement cost coverage will cover the entire cost of rebuilding your home. Obviously the more extras you include in your insurance package, the higher your quote will be.

The main thing that you need to know about all home insurance policies is that they all have loopholes. That is why it is so important to read the small print. Some policies will cover accidental damage but some won't. So before you sign anything, make sure that your policy has everything that you need included. Would you like any extras for additional peace of mind? Do you know that most policies don't cover storm damage and some don't even include theft coverage? Many people learn the hard way that their policy doesn't cover what they need. So always read the small print to avoid learning a harsh lesson when you do need to make a claim.

The type of coverage that you need will depend upon whether you are a homeowner or a tenant. Usually tenants will only ever need contents coverage. However homeowners would benefit from taking out a joint building and contents policy. Before you take out any policy you should have a good idea of how much your home is worth and how much cover you actually need. It is pointless taking out a policy for 15,000 when the contents of your home only add up to 7,000 for example.

Overall by understanding house insurance it can potentially save you a lot of hassle as well as money when it comes to choosing the best policy for you. With so many different policies available, without knowing what you want and need it could be a nightmare finding a suitable home insurance policy.
About the Author
David Thomson is Chief Executive of BestDealInsurance an independent specialist broker dedicated to providing their clients with the best insurance deal on their home insurance, car and life insurance.
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