In the UK, a Contents Insurance policy covers your household goods and personal property within your home and also property for which you are legally responsible. In general it would cover anything you are likely to take with you when you move home such as furniture, furnishings, household equipment, etc. Many policies include money, credit cards and valuables up to a stated limit and sometimes fixtures and fittings belonging to your tenant. If you are a tenant, check with your agreement with the landlord if you need to take out Contents Insurance to cover your possessions and those you may be legally responsible.
Contents Insurance covers your contents for loss or damage caused by insured events such as fire, lighting, explosion, earthquake, theft, storm, flood, etc. It is important that you carefully estimate the value of your contents as "under insuring" may cause your claim to be reduced or rejected. Recently a new type of policy has been made available in which the value of your contents is based on the number of bedrooms in your home. You should judge if this estimate provides a good assessment of the value of your possessions.
There are 2 basic types of Contents Insurance. An "indemnity" policy takes into account "wear and tear" when a claim is assessed and is a lower cost option. This means that the amount you receive may not be sufficient to replace the damaged property. A "new for old" policy is more costly but the amount you receive should be sufficient to cover the replacement of the damaged property. Check if the sum insured is index-linked to allow for changes in replacement cost.
Points to Watch: Generally, today's insurance policies are written in "plain English" so when comparing quotes and policies, read the documents to check for cover extensions and exclusions. A low premium may contain high "deductibles" or may require an approved alarm system to be installed. With a higher premium, cover extensions such as accidental damage cover or damages arising out of your legal liability to the public, may be included. Valuables such as jewellery, furs, paintings, gold, silver, etc may require separate cover or at least need to be itemised separately. In addition if you choose to insure some valuables (e.g. jewellery) when outside your home, an "All Risks" extension will be required.
For peace of mind, select a provider with a good reputation for handling claims smoothly and quickly.
