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Tuesday, October 28, 2014

Understanding Contents Insurance

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Contents insurance is designed specifically to protect your personal belongings. What does contents insurance protect against? Contents insurance will usually cover most types of accidental damage, such as damage caused by fire, floods, earthquakes, storms, lightning and water damage. It will also cover you against damage caused by malicious acts, such as vandalism, theft, attempted theft and criminal damage. Most contents insurance policies will also provide cover against subsidence, falling trees and vehicles crashing in to your home.

What is covered by contents insurance?

Insurance policies differ, but most policies will cover your personal possessions and household furniture. Some policies will provide cover in the event of accidental damage caused to electrical equipment, such as televisions, computers and stereo equipment, as well as other equipment, such as satellite dishes and television aerials. 

Most contents insurance policies will cover you against legal action taken by visitors to your home. For example, if somebody injures their leg while visiting your home, any legal action they may subsequently take will be covered by your insurance policy. 

If your home is temporarily uninhabitable, perhaps due to flooding, fire or serious damage, your insurance policy should cover the cost of alternative accommodation, as well as any costs incurred by finding suitable storage space for your possessions.

If you lose your house keys, most contents insurance policies will cover the cost of a locksmith, as well as replacement keys and locks. Some policies may also cover other costs, such as the cost of replacing frozen food that is spoiled due to power outages. 

Additional cover

Optional extras can usually be purchased with your contents insurance to cover specific needs that you may have. Most insurance providers offer extended cover against accidental damage, which will cover specific items that may not be covered by your regular policy. You can also cover your personal possessions against loss when you are away from home. Different insurance providers may offer other cover options to suit your particular circumstances, so it is always best to check with your provider.

Exclusions

Contents insurance policies will usually have an upper limit on the value of items covered by your policy. If you have valuable or expensive items that you need to insure, check with your insurance provider to see if they are covered under the terms of your policy, as you may need to purchase a different type of cover for these items. 

Some contents insurance policies will not cover loss or damage that is caused by trade or business activities within your home. If you work from home, or run a home-based business, check with your provider to make sure that your work will not invalidate your insurance policy. Some policies will not cover your contents if you have let your property to a third party. If you are letting or sub-letting your property, you may need to purchase a separate insurance policy.

Before buying a contents insurance policy, it is important to check the contract thoroughly to make sure that you understand which items are covered, and under which circumstances they are covered. You should also check to see if there are any additional fees and charges that may be added to the cost of your policy. Always read the small print and, if in doubt, ask the insurance provider for clarification.

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