Contents Insurance Explained
Contents insurance covers the repair or replacement cost of possessions in your house after events such as fire, flooding or burglary. It is not compulsory to have contents insurance, although it is essential if you would be unable to afford to replace lost or damaged items yourself. If your home contains valuable items these will need to be valued and listed in the policy. With the unfortunate truth that one in three of us are likely to become burglary victims, it is sensible to protect ourselves against loss of possessions.
So what does contents insurance cover? The answer is anything from the food in your freezer to the tools in your shed. Also covered are electronic equipment and household appliances, jewellery, sports equipment, and even garden plants.
Indemnity cover is the cheapest type of contents insurance. You will be able to claim for damaged or lost items, but depreciation will be included in their value. It is possible to get ‘new for old’ cover, which replaces lost items with brand new versions. You will pay more for this type of cover, but it is often worth it.
If you are worried about burglaries occurring whilst you are out and about, ‘All risks’ cover will give you peace of mind. Items such as bicycles and mobile phones can be covered by these policies.
Finally, it is a common mistake to under-estimate the value of your household possessions. It is worth taking the time to draw up an inventory of all the things you would like the policy to cover.