What Does Contents Insurance Cover?
Caeva O'Callaghan | May 21st, 2020
Contents insurance is different to buildings insurance. But do you need it, and what does it cover?
Contents insurance pays for repair or replacement of your personal possessions or home furnishings. It will cover your white goods, electronics, furniture, clothing, jewellery, toys and games.
It’s different from building insurance in that contents insurance does not cover the structure of your house or any permanent fixtures, such as doors and windows. A useful rule of thumb is if you turn your house upside down, anything which falls out is contents, and the rest is buildings.
In this article, we’ll answer questions like:
- What is covered under my contents policy?
- What does my contents policy not cover?
- Should I make a claim on my contents insurance?
When it comes to contents insurance, it’s easy to miss some vital belongings when you’re getting your quote. So, be careful and always be honest with your insurance broker about what you have.
What’s covered under contents insurance?
When you take out a contents insurance policy, you need to go through your house and make a list of the close approximate value of everything you own. If you have a very small apartment, or live on your own, you may be able to do this off the top of your head.
However, it’s always a good idea to get up and physically walk through your house, really noticing what you have and taking the time to value it. You may be surprised.
A typical contents list may include the following:
- Household goods – e.g. appliances such as televisions, cookers, fridge freezers and vacuum cleaners
- Electronics – e.g. laptops, phones, games consoles and hairdryers
- Furniture – e.g. beds, sofas, tables and shelves
- Furnishings – e.g. curtains, carpets, rugs, lampshades and cushions
- Valuables – e.g. jewellery, watches, works of art and signed memorabilia
- Personal belongings – e.g. shoes, clothes, accessories and toiletries
- Money – e.g. cash, cheques, premium bonds and travel tickets
Tallying up all this often leads to a bigger amount than you were expecting. That’s all right, because the purpose of insurance is to accurately compensate you for these things if they’re lost. Do not try to lower the cost of your insurance by leaving your laptop or works of art off the contents policy. If there’s a fire or flood, you will not have the money to repair or replace them.
What risks are covered?
Contents insurance protects your possessions against many risks. Each policy may be slightly different, so check your policy wording carefully before purchasing insurance.
Risks that contents insurance will cover will usually include:
- Fire and arson
- Smoke damage
- Storm or flood
- Ground subsidence or heave of the earth beneath your home
- Escape of water or oil from any fixed water or heating installation or domestic appliance
- Impact involving an aircraft, aerial device or anything falling from such devices or vehicles
- Falling trees or branches
- Falling aerials, satellite aerials, their fittings or masts
- Riot, civil commotion, strike, or political disturbance
- Malicious damage or vandalism
- Theft or damage sustained in an attempted theft, including burglary
Contents cover may only apply whilst the possessions are within the home. However, some policies will cover your belongings if you take them out of the home, provided you do not leave the country. If you often make foreign business trips, you might want to consider taking out extra “all risks” cover.
Your contents insurance will not usually protect against accidental damage by default. For example, if you kick over a can of paint and get it on the carpet or your dog knocks over the TV, you won’t be able to claim on your home insurance unless you have accidental damage cover.
Accidental damage is a great idea for people with small children, pets or who just worry about clumsy moments.
Some policies include accidental damage cover as standard. But this isn’t the case for all policies. Bear this in mind when you compare quotes for contents insurance.
A word on excesses
Adding up the total value of the contents of your home may lead to dismay as you realise your policy may be more expensive than you realise. However, you can lower the cost of your monthly premium by increasing your excess.
An excess is the amount you pay in the event of making a claim. Think of it as the price you pay to claim on your insurance. One of the reasons insurance companies charge an excess is to deter people from making many frivolous small claims, which costs time and money to process. If you increase your voluntary excess you will have to pay more if you claim, but it should lower the amount you pay each month.
It all depends on how often you think you’ll make a claim. If you’re only planning on making a claim in a rare worst case scenario, it will be worth increasing your excess. But if you live with boisterous children and animals and foresee having to make many claims, it’s worth paying more a month to lower your voluntary excess.
And it should go without saying that if the cost of repairing or replacing the damaged items is less than the excess you’ll have to pay, it’s well worth not getting insurance involved and just replacing the item yourself.