Home Insurance 101: What It Is & Why It’s Important
There is no asset more important to us than our homes. It’s our safe and special place where we create memories and build our lives.
Why do we need home insurance? So we want to do everything we can to keep it protected. After all, there’s nothing more devastating than losing your home and everything you’ve worked for!
That’s where home insurance comes in. When it comes to protecting your home, getting insurance should be at the top of your list! To protect valuables outside the home you’ll need travel insurance.
Unfortunately, a lot of homeowners don’t realise how important home insurance is. That’s why we’ve put together a list of the basics you need to know about it. Read on to find out more about home insurance, what type matches your needs, and why it’s so important!
What is home insurance?
Home insurance is often divided into two categories:
Building insurance – covers expenses for damages to your home’s structure. This includes:
- Roofs
- Walls
- Windows
- Permanent fixtures (such as wiring or plumbing).
Contents insurance – covers expenses for loss, damage, or theft to your belongings inside the home. If you have luxury goods you’ll want to read this article.This includes:
- Furniture
- Electronics
- Jewellery
- Furnishings
- Other personal belongings
Most providers offer a combined home insurance policy of both. You can also get separate policies, depending on your needs.
Does contents insurance cover clothes?
Yes, it does! Most contents insurance policies include clothes as part of your valuable possessions. If you have designer clothes or furs, though, you might need to get specialist insurance for your high-cost valuables.
Why do I need home insurance?
The harsh reality is that there are things beyond our control that can damage our home. These can make you lose the assets you’ve worked hard for.
So it’s important to ensure you have a safety net for your home and your possessions should the worst happen. Here are a few things that home insurance can keep your home protected from:
- Fire
- Floods
- Earthquakes
- Windstorms
- Damage from burst pipes
- Theft
- Vandalism
What type of home insurance policy do I need?
This depends on the type of home and home ownership you have.
Owned home
Costs for rebuilding or maintenance can be quite steep. It’s a good idea to have an estimate of the costs of your home structure and belongings. This will help you find the specific insurance policy that’s best for you.
Mortgaged home
Most banks or mortgage providers will likely require you to get homeowners insurance. This is to protect their investment. They might also insist on getting special insurance if you live in a flood-prone or fire-prone area.
Rented home
Renters need not worry about building insurance. That’s your landlord’s responsibility; make sure to ask them about it. But it’s a good idea to get contents insurance for your personal belongings.
Large houses
If you live in an especially large home, standard home insurance may not be able to cover the costs of rebuilding or upkeep. It’s best to get large property insurance or specialist cover if your house has more than 6 bedrooms.
What insurance add-ons can I get?
Standard insurance policies may not be able to meet all your unique needs. Here are a few examples of extra covers most insurance providers offer:
- Accidental damage – covers breakage or damage from household accidents
- High-value items – covers expensive possessions such as jewellery and electronics.
- Legal expenses – covers costs for legal disputes or personal injury cases