Photo albums, precious jewelry, and family heirlooms are just some of the items in your home that hold more than just monetary value. Home and contents insurance is vital if you want to make sure your home is safeguarded from potentially disastrous events such as fires, storm damage or burglaries.
Home insurance protects the physical home and structures such as the roof, fixtures, and plumbing. If you’re a homeowner, it is likely that your mortgage broker will have mandated that you take out home insurance. Contents insurance protects the possessions inside a house and includes things like your furniture, electronics, and other valuables.
When you purchase a ‘home and contents' insurance policy, as the name insinuates both your home and your possessions are protected under the one policy. Purchasing this combination of insurance is the most effective way to protect your assets.
Don’t rush into taking out your insurance policy. As with anything of this importance, do your research prior to signing on the dotted line as not all policies are created equal. Take the time to consider exactly which assets you wish to cover and the level of coverage you would like. Speak to a number of providers and compare policies so that you get a good idea of the different levels of cover out there and which ones might suit your needs best.
Advanced home and contents cover
Advanced home and contents insurance coverage will not only protect you from extraordinary events like fires and theft but will also protect your valuable possessions from damage caused by smaller accidents. However, obtaining this level of coverage will also add to the cost of your coverage.
When setting up your home and contents insurance, the insurer will ask questions about your home and your family to determine their level of risk when writing your insurance policy. There are other factors that might affect the cost of your insurance. For instance, a home located in a flood plain in northern Queensland may result in a pricier premium than an apartment in the Melbourne CBD. Cover for flood, storm or fire damage for example may be optional in certain policies, so make sure you read the fine print and get at least three quotes to compare not just pricing but type and level of cover.
Insurers may also request some images of your home and its contents before activating your policy. These photographs are used to prove the condition of your contents and to complete ‘before’ and ‘after’ comparisons when you make a damages claim.
When making a claim, the insurer will pay for part of the loss or damage, however, the excess is the amount you pay. The excess is the sum you pay the insurer if you need to claim on your policy. Before committing to a home and contents insurance policy, ensure that you are comfortable with the level of insurance excess you’ll need to pay if you need to lodge a claim. Again, this will vary from policy to policy - so do your research!
The hope is that you won’t need to do this often, if at all! However, if you ever do need to make a home and contents claim, you will first need to provide proof of the monetary value of your home and its contents. In the event of damage or theft, the best way to prove ownership and value is via receipts and proof of authenticity for valuable items, like jewelry. If you do not have the appropriate receipts, you can also provide proof in the form of:
In the case of a burglary, however, certain factors may void your claim. These factors include leaving your house unlocked, neglecting to set the home alarm, leaving your home unattended for an extended period of time, or failing to report the theft in a timely manner.
Home and contents insurance ensures that your possessions and house are covered for both accidents and the unlikely events of catastrophe. Shop around and compare before selecting a policy that suits you and your family.
Click on the links below to read more about other types of insurance you might need when buying a new home:
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