How Valuable are your Valuables?

Everyone has different opinions of what is considered valuable. For some people, valuable can be the latest HDTV, digital camera, games console or even plush furnishings such as recliner chairs and deep-pile carpets. For others, valuable can be the antique vase that sits on the hearth, or the diamond necklace that is only worn at family weddings; while others still, will consider their home or car as being valuable.

For some, valuable is entwined with material possessions, and for others, valuable carries more emotional connotations. But, regardless of your personal take on what constitutes valuable, have you ever stopped to think what would happen should those valuables be cruelly torn away, perhaps through theft, perhaps through natural disaster such as fire or flood, or perhaps even through mishap? Would your bank balance be able to cover the cost of replacing your valuables, or would they be forever lost?

A lot has been written with regards to the benefits of home insurance, and while for many it seems like an unnecessary expense, it can provide peace of mind should anything untoward occur which affects that which you deem valuable. However, recent reports suggest that many homeowners and tenants still don’t hold suitable home insurance policies — or indeed, don’t have one at all — despite the UK being subjected to floods, severe storms and even earthquakes in recent times!

While home insurance can’t replace the emotional or sentimental value of those possessions you hold dear, it can replace the material value and allow you to get back on track with your life in the wake of any unfortunate loss. However, the cavalier ‘stiff-upper-lip’ bravado of many people in the UK often means that people might believe such unfortunate losses are unlikely to affect them directly, and so tend to look upon home insurance as an optional extra, especially if they’ve never had need for it previously, and so consign it to the back of their minds.

There are two facets to home insurance: buildings and contents, and both can be bought together or separately. For mortgage-payers, at least, it is highly likely that buildings insurance will be included as a condition of the mortgage, as it will cover the cost of total loss of the property through fire, flood or subsidence and clear off any existing mortgage.

Essentially, buildings insurance covers the structure of the home, including all the fixings and often also covers outbuildings and garages, as well as gates, fences and driveways. However, some policies may exclude certain aspects and it is common in the case of flooding or storm damage that, while your home structure is protected by the policy, your gates and fences might not be. Buildings insurance typically covers damage caused by among other things, flood; subsidence; heavy storms; fire; lightning; vandalism; falling trees and branches, although it is always worthwhile to ensure you fully understand exactly what your policy does and does not cover, so you can take remedial action. For example, if you live in an area prone to flooding, then ensure your policy covers you against flood damage. If it does not, you can either source a new policy that does, or ask your current insurer to add flood protection to the policy, although there will likely be an increase in the premium for this added cover.

Contents insurance, as the name implies, covers a home’s contents, which can range from the carpets to the latest HDTV to that diamond necklace or antique vase. Contrary to what some people might believe, contents insurance is a completely separate entity to buildings insurance, so while your home may be protected with buildings insurance, your possessions are not and vice-versa. If you are a tenant, either via your local council or a private landlord, then in the majority of cases they will already have buildings insurance on your property, but you should still investigate contents insurance to safeguard your belongings.

It is important to consider the level of insurance cover you need when considering home insurance. In terms of buildings insurance, you should look to insure for the total cost of rebuilding your home, while for contents insurance, you should look to cover the cost of total loss of your possessions. It’s important, therefore to regularly inventory your home and possessions and adjust your home insurance policy accordingly to reflect the new value.

Home insurance needn’t necessarily be expensive either, and you can buy buildings and contents insurance either separately or together in a single policy. Furthermore, there’s no requirement to hold both policies with the same insurer, although many insurers will offer discounts for you to do so and it can very often make things simpler and smoother if you ever need to make a claim. This means you can better balance your cover and find the best policy for your needs, both in terms of price and protection.