Once you’ve purchased a house, there’s a lot of excitement and things to do. But one thing you shouldn’t overlook is home insurance. If something happens to your home, insurance can help cover the cost and mean you’re able to focus on what’s important without having to worry about how you’ll pay for the damage.
With so many other things to think about, home insurance can be something that’s rushed, but it could cost you money. Here are eight things to do first before choosing a policy.
1. Shop around for a deal
There are hundreds of insurance providers to choose from and the cost offered by different providers can be widely different. If you’re taking out a mortgage, your provider will usually offer you a home insurance policy too. Don’t just accept the first you find, but shop around.
Compare the price of different policies to find the best deal for you. But don’t just look at the premium costs. You should take a closer look at what the policy covers. Finding out a policy doesn’t cover everything you need it to can be a costly mistake if you find you’re not as protected as you thought when you need to make a claim.
2. Should you get contents and building together?
If you’re moving into a new home, you’ll probably need to take out both building and contents insurance. Buildings insurance will protect the property, while contents insurance will protect your items, from furniture to clothes. If you’ve just purchased your own home, you’ll also usually need to take out both types of insurance. The exception is if you’ve purchased a leasehold property. Typically, the freeholder will take out building insurance but be sure to double-check.
You can choose to take out two separate policies with different providers if you wish. However, in most cases, you’ll save money by combining the two.
3. Check the value of the property and belongings
When taking out both building and contents insurances, you’ll need to select a level of cover. Make sure this accurately reflects the value of your home and belongings.
Over insuring can mean your premiums are higher than they need to be, costing you money. Under insuring could leave you short if you do need to make a claim. So, getting an accurate picture of the value of your home is important. Remember, the value of both building and contents will change over time.
4. Decide if you’d benefit from extra cover
Depending on your circumstances, you may want to take out additional insurance to cover specific claims. For instance, this may include high-value items that exceed the usual limit, such as your computer or other technology. Alternatively, you may also want to ensure you’re insured for certain items if they are damaged or stolen when you’re outside of the home, for instance, your mobile or laptop.
5. Read the small print
Reading the small print is a task many of us skip. Yet, when it comes to insurance it’s important and can help you understand what you’re covered for. Insurance policies will have exclusions, meaning you’re not covered in certain events, so it’s essential you understand these. In some cases, you may benefit from seeking an alternative policy.
Other times, you’ll realise you’re covered for something that isn’t required. Do you really need your garden covered if you live in a flat? Getting rid of the things you don’t need can help reduce the premiums.
6. Choose a higher excess
The excess is the amount you pay out when making a claim. It can be tempting to choose the policy with the lowest excess, but this will usually mean higher premiums. It’s worth comparing how these two costs affect each other. Whether you’d prefer a lower excess over higher premiums will depend on your priorities and circumstances. But if you want to reduce your regular outgoings, opting for a higher excess charge will usually help you achieve this.
7. Make security upgrades
The more secure your home is, the lower the premiums will be. If you’ve been thinking about making some upgrades to your home, doing them beforehand can save you money.
There are plenty of options that could lower the cost of insurance and make your home more secure. One of the first things to consider is the type of lock mechanism your current doors use and if your windows are secure. Other areas to consider may include a burglar alarm and security cameras. While these measures have been associated with bulky and unsightly items, modern options are often discreet.
8. Pay annually
If you can afford to, choose to pay annually rather than through monthly premiums. Meeting the cost of property insurance for the full year straight away will mean it costs less overall. Even a small reduction in premium costs can add up over the years you’ll be buying home insurance.
If you’re planning to purchase a new home, property insurance is just one thing you’ll need to consider. While you’re insuring your new home, it’s worth considering if you should protect yourself too. Financial protection products can pay out a lump sum or a regular income in certain circumstances, for example, if you became too ill to work. Please contact us to discuss your financial needs, including protecting your income and family.
Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.