E-Paper
Sign In
Renting or Owning: Insure and Protect Your Homely Possessions
FOR most of us here who rent our homes, include most likely, everything we own.
- PUBLISHED: Tue 5 Jan 2010, 12:13 AM UPDATED: Mon 6 Apr 2015, 10:23 AM
- By:
- Dubai Raj (PERSONAL FINANCE)
So what it would cost to replace every single item if it were destroyed in a home fire or flood, or if they were stolen in a break-in?
Recommended For You
Replacing your property, that includes your home, electronics, computers, TVs, carpets, furniture, appliances, clothes, and other countless other items that could put you out of pocket & financially break you.
You may wonder if you really need home and contents insurance.
The truth is, you probably do.
If you are renting the items from the landlord then you may be responsible for them, and if this is the case then you will want to make sure that you have enough insurance to cover them if something such as accidental damage or theft was to occur. If there are items, such as furniture, already in the home that are owned by the landlord, then you will want to read through your tenancy agreement before you sign it and make sure that it states who is responsible for insurance on those items.
When we rent a home, the actual structure of the home is usually covered under the landlords’ building insurance. This insurance will cover anything that happens to the home whilst you are living there such as, structural damage, roof & water damage caused by bad weather. The landlords building insurance will not cover your possessions which is why it is important for renters to obtain contents insurance.
Whilst there is no law that states that you have to have insurance to cover your possessions it is important to do so, because you really have no control over what may whilst you are living in your rented home.
Tenant insurance will cover your possessions if there is ever a flood, fire, theft or vandalism. Do you have any priceless works of art? Rare collections (large or small)? Family heirlooms? How about jewellery? Most policies pay for accidental damage, but the extent of cover varies, so you will need to check this with a good insurance broker. Many insurers cover the cost of replacing locks if your keys are stolen.
Most policies may be extended to cover accidental damage or loss of valuable items you frequently take out of your home, such as jewellery, cameras and sports equipment. It is known as an ‘all risks extension’. Also you may want to check whether you would want cover if you accidentally injure another person or damage their property. Most policies pay damages for which you are legally liable for.
You should find out from your insurance broker what types of items would be covered/excluded by your insurance company. Some polices do not cover expensive items like art & antiques, watches and jewellery. Often very expensive items require that you buy added insurance for the items specifically. In the event that something happens, most insurance companies will usually replace old items with new. However you need to ensure you have this ‘new for old’ policy otherwise you may find that the insurance will not pay sufficient money towards replacing the item. Obviously before you call an insurance agent you will need to figure out how much your items are worth. The easiest way to do this is to go from room to room and calculate the value of each of your possessions. You may be surprised at how much your items are worth when you are finished. Most homes contain $50,000-$60,000 worth of items. Not a small sum to fork out should you have to replace everything.
Homeowners insurance is a type of property insurance that covers private homes. It is an insurance policy that combines personal insurance protection to one’s home, contents, loss of its use, as well as additional living expenses, and also providing liability insurance for accidents that may happen at the home. It requires that at least one of the named insured occupies the home.
Points to note: Home contents are deemed to be those items that can be removed from the property and are not part of the integral structure of the property. For example, fitted wardrobes would not be considered to be covered under a home contents policy whereas free-standing wardrobes would as they can be removed from the property. Similarly carpets would be considered as contents whereas floorboards are part of the structure of the house. Items such as Plasma TVs, musical instruments, CD and DVD collections, clothes, curtains and kitchen electrical items are all considered contents under most home insurance policies.
You can be insured against all sorts of things, such as lightning, storm, subsidence, accidental damage, water damage, theft and vandalism, but you must be aware of large value items as there may be a limitation on payouts for these types of items.
Specific cover may be needed for accidental damage to mirrors, carpets and business equipment that you have at home; again it pays to be aware of the limitations you would receive on a new-for-old basis. Burglar alarms and strong locks on doors will benefit from the opportunity to reduce premiums. The insurance companies can reduce your premiums when you have such a situation as it reduces certain types of risk like being burgled.
Home Appliances: Contents insurance can help ensure you don’t get caught out with the cost of repairing an expensive home appliance. Though most products are covered with a 12-24 month manufacturer’s guarantee, its after this period that you require insurance protection against fault. The types of items available to this type of insurance include large items like plasma TV’s, washing machines, and small items such as kettles and irons.
Home appliance cover is a great way to protect everyday items within your home that are used constantly. With home appliance cover you can take out insurance from a specialist insurer who will usually provide a replacement item whilst your appliance is in repair at minimal insurance cost.