Home contents insurance: a quick guide
If you don't need to insure the building you live in, consider home contents insurance for your possessions. Our quick guide will help you get the best deal.
Home contents insurance covers things in your home that you could take with you when you move - from curtains and carpets to TVs and washing machines. It also includes clothing, personal possessions and valuables.
If you're buying buildings insurance as well, it's often cheaper to buy both types of cover together. But if you rent your home or live in a leasehold property where the freeholder insures the building, you can save money by choosing contents insurance on its own.
What does it cover?
Most basic policies cover loss or damage caused by theft, fire or flooding in your home, but you can insure for a wider range of risks - for example, many policies include cover up to a certain amount for things that are lost or stolen when they're outside the home.
Extras worth considering are:
- accidental damage to goods or furnishings
- all risks insurance for personal possessions outside the home, for example a camera or bag you lose while on holiday
- food in the freezer
- personal money and credit cards
- legal expenses
- garden equipment cover for things kept in a shed
- bicycle cover for your bike being stolen outside the home
Some policies will include these as standard, so make sure you're comparing like with like.
How much should I insure for?
Some insurance companies offer bedroom-rated policies, basing the premium on the number of bedrooms in your home. Others offer sum-insured policies where you work out the cover you need.
It's important to get a good idea of the total value of your house contents and possessions - underestimate and you might not be able to replace everything, overestimate and you could pay too much for your insurance.
To get you started, read our quick guide to valuing your home's contents
Valuable items
You'll often find that just a few valuable items - like jewellery, antiques or electronic equipment - make up a large part of the value of your possessions.
Many policies have a limit on the amount they will pay out for a single item. You can still insure items worth more than this, but you must give details of them when you buy your insurance so they can be named on the policy.
New-for-old or indemnity?
You can insure your contents on a new-for-old or indemnity basis. With new-for-old, you receive the full cost of repairing any damaged items or replacing them with equivalent ones.
An indemnity policy will make a reduction for wear and tear and depreciation - for example, a 10-year-old carpet will be worth less than a new one and your insurance payment will reflect that. Clothes and household linens are usually insured for indemnity only.
Key points
- Decide whether you need new-for-old or indemnity cover.
- Work out the value of your possessions.
- Check what's included as standard to make sure you compare like with like.
- Specify any valuable items that are worth more than the single item limit on your policy.