Work out what you need
If you own your property, you will need to cover the building and its contents – unless it is a leasehold flat and the freeholder insures the block. This should be spelled out in your lease. If you are a tenant, you will only need contents insurance.
One of the first questions an insurer or comparison website will ask is how much cover you want to buy. For the building, this won’t be the market value of your home, but how much it would cost to rebuild.
Matthew Harwood, a home insurance expert at the comparison website Confused.com, says the market value is often “significantly higher”. Use this instead of the rebuild value and, he says, “you could be overinsuring your home and therefore paying more for your insurance unnecessarily”.
Some websites have tools to help you work out the rebuild value while you are doing your quote – Confused.comhas one. Or you could use a separate online tool – the Building Cost Information Service (BCIS) offers a calculator. You need to register to use it, and you will need to know the floor area of your home and its approximate age.
If you have recently moved, you should be able to find the floor area in the property details from the estate agent. Otherwise, you might need to get out your tape measure.
Typically, a fitted kitchen and your bathroom suite will fall under the buildings cover, but check that is the case – the policy details should spell it out. If you have expensive fixtures, add extra to the value to cover them.
For your contents, Helen Phipps, a director at the comparison website comparethe market.com, says you may need to go round and make a list of what you own.
“This may include furniture, electronics, your fridge and freezer, clothes, cosmetics, as well as kitchenware and crockery,” she says.
“You should then work out an estimate of each item, which can usually be done by checking the price online or by checking your receipts if you have these to hand. For insurance purposes, the value of an item is normally the cost of replacing it today, which could be less than what you originally paid.”
Don’t forget outside
Lots of people have added outbuildings such as a garden office in recent years. If you are one of them, you need to make sure it is covered.
Lorna Whalley from the insurer Aviva says the structure falls within your buildings insurance, while everything inside comes under contents. However, she says insurers will typically limit the value of items they will cover.
“Contents limits for thefts from outbuildings are usually lower than the main home, so customers should be mindful if they use lots of tech items such as a laptop, tablet, phone etc to work in one,” she says.
Some policies include garden furniture as standard in contents cover, but if you have some pricey plants or equipment, you may need to add an extra element for outside.
Add costly items
Most contents insurance policies include a single item limit, which is the maximum that your provider will pay out for anything that’s included in the general cover. So if the limit is £1,000 and you include something worth £1,200, you will only get £1,000 to replace it. To get cover above the stated limit, you need to list items separately on the policy.
Phipps says that on comparethemarket.com, you will be asked to add items individually worth above £1,500. Some other websites ask above £1,000.
Check your locks
The type of locks you have on your doors and windows will have an impact on the cost of your cover, and you are likely to be asked about them. Take a look before you choose, as if you get it wrong, your insurance might not be valid.
GoCompare’s website has a good guide to the different types, including photos to make it easy to match the names to what you have in your home. Often the lock has the name or type written on it – look at the panel on the edge of the door.
Once you have your cover, make sure you actually use the locks as, again, you could invalidate your insurance if you do not.
Shop around
Comparison websites sometimes have “exclusive” policies, or you might find a good deal that is available direct from a provider, particularly if you have other insurance or products with that company. Direct Line isn’t on comparison sites, so you should factor it in separately. Get a range of quotes before you make your decision.
Compare like with like
When you are comparing prices, make sure the policies match up. Insurers often have different minimum sums they cover, and throw in different extras.
If one policy is cheaper than another, check this is not because it doesn’t include an element that you want, or a bigger voluntary excess.
Use the market value of your home instead of the rebuild value, and you could be paying more unnecessarilyMatthew Harwood, Confused.com
Guardian Money ran a quote on a terrace home in north London, and the 57 results ranged from £304.54 to £1,434.56 a year.
The most expensive policy included cover for accidental damage, legal expenses and home emergencies, and all kinds of extras, including £1,000 for freezer contents. In between, the policies had a mix of different inclusions and payout limits.
Check if a lump sum is less
Typically, spreading your payment over the year costs more than paying in one go, as the insurer will usually charge you for credit. For example, a quote from Churchill via a comparison website that came in at £386.40 as a lump sum cost £425.04 when charged as 12 instalments.
However, not all insurers are charging extra. Nationwide, Aviva and NatWest are among those offering policies for the same price regardless of how you pay.
NatWest also doesn’t charge admin fees when you change your policy, so if you know that you are planning to make changes during the year, it is worth getting a quote from it.
Check the details
When your policy details come through, check them. And do so again when it comes to the renewal. If mistakes have crept in, they could cause problems later on, so make sure everything is as it should be.
During the course of the year, you should let the insurer know if things change. This includes if the property is to be left empty for longer than the period specified in the policy, and if you are having work done to it.
“You wouldn’t normally need to tell your insurer if you’re simply redecorating, but you should tell your insurer if you are creating an extra bedroom, bathroom or shower room in your home,” Aviva’s Whalley says.
