Inadequate insurance can cost a fortune
Check you have the right cover before a disaster, not after, says Harvey Jones
Saturday 12 February 2005
Going without could cost you tens of thousands of pounds, so don't take the chance. When buying or renewing cover, shop around and scrutinise the small print of your chosen policy. Most people only discover what is - and isn't - covered when they make a claim.
The average premium for buildings cover is pounds 209, and pounds 151 for contents, according to AA Insurance; but you can cut your premiums by up to 30 per cent by shopping around. Insurers such as Churchill Insurance, Esure, Direct Line and Tesco Personal Finance offer discounts for buying online.
Watch out for premium hikes at renewal. Insurers often woo new customers with tempting discounts, then sneakily boost premiums in future years. You may get a discount if you buy buildings and contents cover from the same insurer, plus further discounts if you also have its motor insurance. But make sure rates on all these products are competitive. You are not obliged to buy cover from your mortgage lender, which can include a hefty mark-up. Again, shop around.
Calculate the correct level of buildings cover. This should cover the full cost of rebuilding your home - not its market value. If you have converted your loft or added an extension, increase cover in line with the new rebuilding value.
Don't underestimate the value of your contents. If your belongings are insured for pounds 15,000 but are worth pounds 30,000, your insurer will only pay half of any claim. Alternatively, you can choose a policy offering "unlimited cover".
Tell your insurer about any expensive individual items, says Neil Thomas, director of IFA Simpsons, of Brighton. "Many require proof of purchase or valuation certificates for items above pounds 1,000 or so. You may need separate cover for more valuable items such as jewellery and antiques."
Check whether your policy offers "new for old" cover, or makes deductions for wear and tear. Also consider all-risks cover, to protect valuables outside the home, including on holiday. If you do this, you can save money by excluding personal possessions cover from your travel insurance.
Check you have the right security locks. Cilla Black had a pounds 1 million burglary claim rejected because she failed to install locks on her downstairs windows, where burglars broke in. Sharon Osbourne suffered a similar fate last year. Installing an approved burglar alarm or secure locks should cut down your premiums.
Consider paying premium annually rather than monthly. "Some insurers charge up to 30 per cent APR to pay monthly, costing you an extra pounds 20 a year," says Richard Mason, director of the price-comparison website www.Insuresupermarket.com. Also check how much excess you will pay on any claim.
Where possible, seek prior approval before paying for any work and keep all receipts for work done. Take photos of the damage before work starts and keep any damaged or destroyed goods for your insurer to inspect. Get a couple of estimates from different builders - your insurer can usually recommend approved tradespeople.
If your property has previously suffered flood or subsidence, you might struggle to get cover elsewhere. Insurers have a "gentleman's agreement" to continue covering existing customers whose homes are in flood- or subsidence- prone areas, or have made previous claims - which is better than not getting any cover at all.
If you are unhappy with the way your insurance company has handled your claim, first complain directly to them. If still unhappy, take your grievance to the Financial Ombudsman Service (0845 080 1800, www.financial-ombudsman.org.uk).
Liam Neeson's Downton dreams
Thriller is set in the secret world of British espionage
Bomber jacket worn by Mary Berry sells out within an hour
Life & Style blogs
Hipster hate is everywhere - but is there a little bit of them in all of us?
Jennifer Lawrence nude pictures leaked: Reddit removes 'The Fappening' board dedicated to sharing naked pictures of celebrities
A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
iOS 8 download: how to free up space on your iPhone or iPad to install update
U2 album removal tool released by Apple (but you can't escape: Bono is always on your iPhone)
Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
Scottish independence referendum: A nation divided against itself
Scottish independence: David Cameron is becoming the 'George Bush of Britain'
Russia freezes Ukraine into submission: Kiev admits country doesn't have enough fuel for winter
Scottish independence: The Queen breaks silence on referendum debate – as think tank warns of £14bn black hole if Scotland votes Yes
Portuguese academic says British are 'filthy, violent and drunk'
- 1 Scottish independence: Learn from Quebec's mistakes and beware of promises. Vote Yes.
- 2 iOS 8 is full of shiny new features - but it's terrible news for app developers
- 3 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
- 4 Hitler’s former food taster reveals the horrors of the Wolf’s Lair
- 5 Cocaine and cannabis haul hidden in Vatican car seized by French police
Unpaid Voluntary Position : Reach Volunteering: Promising volunteer Trustee op...
£30000 - £35000 Per Annum: Clearwater People Solutions Ltd: Our client is curr...
£110 - £130 per hour: Randstad Education Reading: Psychology Teacher needed fo...
£85 - £120 per day: Randstad Education Cheshire: Randstad Education are curren...