We’re not going to pretend otherwise – home insurance can be pretty boring.
But it is important to get it right. It could be extremely damaging financially if you had to make a claim, only to find out that your policy wasn’t valid and in fact, you weren’t insured at all.
Here are a few common issues that can crop up with home insurance. Make sure you don’t fall foul of any of these.
You may think that being underinsured isn’t a huge problem. For instance, you may have told your insurer that your contents are worth £20,000, but in fact, it is worth £30,000. In this scenario, should you want to make a claim for the whole lot, you might just think that the insurer would pay you the £20k and you would just have to accept missing out on £10k.
But actually it could be worse than that – your insurer could refuse to pay you altogether or pay you a reduced amount, on the basis that you mislead them or didn’t give the full information, in order that you could get away with paying a cheaper premium.
Don’t fall into this trap. Go from room to room and price up everything as accurately as you possibly can. It is probably better to be slightly over-insured than under-insured, although of course, this would result in you paying more for your premium than you need to.
Going away and leaving the home vacant…
Each insurer usually has a period of time stipulated within their terms, dictating for how long you can leave your property unoccupied. Usually, this is around 30-days, which is more than sufficient to account for most people’s annual holiday. But if you are going away for longer than this and you need to make a claim when you get back (for instance if your home were broken into) then you could be in for a nasty surprise.
Also, some insurer’s allowable unoccupied periods are shorter than 30 days – so you should always double-check before you leave.
Renting out a room…
Renting out a room or taking in a lodger is not especially unusual in this day and age and can be a good way for you to make a little extra income on the side. Indeed – HMRC allows the first £7,500 of any rent your earn to be claimed tax-free.
But rather than leaving you quids in, this could actually turn out to cost you money – if you don’t inform your home insurer that you are renting out the room. An additional person living in your house, especially someone who is not necessarily a family member or well known to the property owner, could change the insurer’s view of the level of risk you present to them, and thus, invalidate your policy.
Carrying out building work and not informing your insurer…
This is probably something that is not widely known – but if you are undertaking any building work, even relatively small works, you should let your insurer know. If you don’t and you need to make a claim during the time the works are being carried out, you may find out you aren’t covered.
Deceiving the insurer…
It is unlikely that any rational person would seek to deliberately mislead or pull the wool over their insurer’s eyes, but you could find that you have accidentally done just that. When you apply for your insurance, chances are you answered questions about the sort of lock you have on your door, the burglar alarm you have at your property, etc. etc.
If these details are not actually accurate, then your insurer could decide that you were attempting to deceive them and lie about these pertinent details and invalidate your policy.
Take pre-emptive action…
So with all of this talk of taking action to make sure any claim you make is valid and paid, the best thing, of course, is if you don’t have to make a claim in the first place!
You should ensure that you keep on top of essential maintenance tasks around the home that will help reduce the chances of having to make a claim.
If you have an open fire, ensure you get your chimney swept regularly. Clear out your gutters and replace or repair any that are dripping, check roof tiles or slates for any that are cracked or damaged and replace these. Get your boiler serviced annually, and insulate any outside pipes to ensure that they won’t freeze and break.
These tasks are all relatively easy to do and relatively inexpensive, particularly compared to the cost of having to pay the excess on your home insurance and the increased premiums that may occur as a result of making a claim against your policy.