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A Guide to Home Insurance

A house is undoubtedly the most expensive thing you will buy in your lifetime, so you want to make sure it is fully protected, right? But for first time buyers it is often unknown about the types of insurance that are available and worthwhile taking out.

As removal experts with years of experience helping people relocate and move houses, we’re going to run through the two main types of insurance  every homeowners needs in order to protect their property and have peace of mind too!

The two most common insurances are contents insurance and buildings insurance, but what are the main differences between them both and what else should you be aware of as a new homeowner?


Buildings Insurance

Many mortgage lenders insist that you take our buildings insurance as part of the terms of the mortgage. Why? Because if they are lending you money, they need to know that you will be able to afford the cost to rebuild or see to any repairs that may crop up, and still be able to keep up with your mortgage repayments.

With buildings insurance, the structural parts of your house are covered, such as the roof, walls, windows etc. This also includes any permanent fixtures like fitted bathrooms and kitchens.

In the circumstance of a fire, storm, flood, subsidence, burst pipe, theft or falling trees, your home’s structure will be covered.

Things to be aware of:

It will NOT pay out for damage due to wear and tear or acts of war and terrorism.
If your home is unoccupied for more than 30 days a year, you may be unable to make a claim.
If you cannot live in your home due to extensive damage, it’s worth checking whether the policy covers the cost for temporary accommodation.

Contents Insurance

In short, contents insurance covers the items that you move from one property to another. A good explanation is, if you took your house and shook it upside down, this would be all the things that fall out of it e.g. clothes, microwaves, technology, DVDs, furniture, jewellery etc.

Things to consider with contents insurance include:

Should you make a claim in the future, check what you would get as an alternative. Basic contents insurance might only replace things like-for-like (it will be of the same age and quality).  Other terms of cover will replace with better, newer versions, but these will come at a higher cost.
Be careful not to undervalue the cost of your belongings. Make a list of everything to include and try and be realistic about their value.
Particularly valuable items such as family heirlooms or precious jewellery may require additional cover, so that there are no limits on pay outs.
Be sure to check what accidental damage covers on your specific policy.

Additional cover

Life insurance/critical illness cover – should you fall ill or have an accident and you cannot work and therefore cannot afford to keep up with your monthly mortgage repayments, your life insurance/critical illness cover will pay your mortgage so your house is not repossessed.

Pet insurance – for any pet owners, pet insurance can help cover the costs of any treatment, operations, vaccinations, neutering etc. that your pet may need throughout it’s lifetime.

Top Tips

Always read the small print of the policies to make sure you fully understand the ins and outs of the insurance cover – it may be tedious but it is definitely worthwhile!
You are not obliged to take out insurance with your mortgage provider. They may try and sell it to you but you are entitled to shop around for the best deal.
Make sure you hold on to any receipts.

These will be invaluable when making a claim.
It is best to pay off your insurance cover in full but if you cannot afford to pay the one lump sum all at once, consider using a credit card with a low APR.

If you’re moving house and are looking for the best removals and storage company throughout Waikato, please get in touch with the expert and friendly team here at Fragile Removals.