What’s the common home insurance within the UK? | MyWalletHero – Motley Idiot Germany

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Home insurance should be viewed as an essential expense when you own a property. Taking out home contents insurance usually means that you want to protect your home against floods, fire, theft and burst pipes. But how much can home contents insurance cost? Here's what you need to know.

What is home insurance?

Household contents insurance consists of two parts: building and household contents insurance. Put simply, home insurance covers the structure of your home, including the roof, walls, floor, and other structures such as fences, sheds, garages, and driveways. Home insurance covers items in your home such as appliances, furniture, jewelry, and electronics.

What is the average cost of home insurance in the UK?

The average premium for combined home and home insurance is £ 141. Just taking out home insurance costs you an average of € 109.86, while home insurance costs an average of € 61.48.

However, note that it is important to read and understand what each of these guidelines covers. You may find that building and content policies combined may not cover some things that are offered under separate building and content policies.

The cost of home insurance has been fluctuating lately. In April, a report from MoneySuperMarket highlighted that the cost of some home insurance premiums actually fell for the third straight quarter. This was likely because Covid-19's restrictions resulted in homeowners spending more time at home, which meant there were fewer break-ins.

As people spend more time at home, they can spot maintenance issues before they cause serious damage. This means fewer claims, makes insurance companies profitable and leads to lower prices.

Can you own a house without insurance?

You are not legally obliged to take out household insurance. However, if you do take out a mortgage, the lender will likely ask for at least home coverage.

It makes sense to take out home contents insurance if there is a significant risk of damage to your property. Your property may be in or near a floodplain or in a neighborhood with a high crime rate.

What does the home contents insurance usually not cover?

The last thing you want is a situation where you are not covered. The solution is simple: take the time to read and understand what your insurance policy covers, including the fine print.

Additionally, it may be important to understand two key phrases:

  • Cover for named hazards
  • All-risk coverage

The named risk coverage lists the risks that are covered by your home contents insurance. If a particular event isn't listed, there is a good chance it isn't covered. As a result, you may have to pay extra for certain risks that are covered.

The all-risk cover protects you against all risks that you might encounter. However, look out for a clause that lists the risks that are not covered. Likewise, you may have to pay extra to have these risks covered.

Here are some of the most common risks that basic household insurance doesn't cover:

  • Flood damage from external conditions (dam failure, rising rivers, canal jams and flash floods)
  • Damage to your car when you park it at home – this is covered by your comprehensive motor vehicle insurance
  • Earthquake damage
  • Hurricane damage

How can I reduce my home insurance costs?

Shopping is usually the first thing most experts recommend. This will help ensure that you are getting the most competitive offer. Remember to compare monthly and yearly payments. Typically, you can save more by paying annually.

Your insurer will ask questions about your property to assess or determine the risk of a claim. You can bet that the condition of your home will affect the cost of your insurance.

For example, installing an alarm system, video surveillance and security lighting will reduce the likelihood of theft, resulting in cheaper home insurance. You may also want to remove trees or branches that might fall on your home, fire-proof your home, and insulate water pipes.

Also, try not to over-insure. Determine the exact value of your property and consider insuring the cost of rebuilding your property, not the purchase price.

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Avatar for Victor Garrett

Victor is a freelance writer who loves reading and writing about personal finance and related disciplines with the aim of educating people to make better financial and investment decisions.

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