Purchasing a home and other home valuables takes serious financial investment. It is for this reason that buyers must ensure homes and other contents are sufficiently covered in order to avoid losing them all in the event of loss or damage caused by fire, theft or natural disasters like floods. Here are some key home insurance tips.
Be aware of upselling mortgage broker
Many banks and building societies encourage borrowers to take out home insurance that is tied in with their mortgage but you may find you are paying more than if you researched the market and insured through a broker. It’s always worth looking for a policy that suits you best and provides the best value.
Always ensure that you have accurate estimates for both the re-build cost of your home and the replacement cost of all contents you had in mind when taking out the policy in the first place.
Insure for full replacement value
Remember that this is not the same as the market value. The value of the land on which the house stands is excluded from the calculation of the replacement value of the actual building of the house.
Increase your excess
If you increase the amount you pay in excess, your monthly premiums will decrease. This means you’re taking more of the risk on yourself. Make sure you can afford to pay your excess, though, otherwise you negate the insurance.
The deductible is the amount you have to pay out of pocket on each claim and applies only to coverage on your house and personal property. Make sure when choosing a policy that you are comfortable paying the deductible if you make a claim.
Combine buildings and contents cover
Consider taking out both policies with the same insurance company, this can often allow you to negotiate a cheaper price. It’s worth comparing the price of getting your buildings and contents cover separately too, so that you can make sure you’re getting the best deal.
Manage your credit
Credit scores impact insurance costs in many situations. The better your credit, the lower your insurance costs. Maintaining a strong credit rating is in your favour.
The tips above should assist you navigate your way around home insurance.