Understanding the Different Insurance Cover Providers
As an owner of a flat you will probably be aware of insurance and how it can protect you. You own a flat and rent it out to others. Usually contents insurance only. The freeholder of your flat will normally take out buildings insurance on their behalf.
But if the lease comes with it, you might have to pay a small share of your buildings insurance – seek out legal advice if you’re unsure whether you’re legally responsible for any part of the building’s structure. Buildings insurance will generally protect you for damage to permanent fixtures in your flat. That could include carpets, kitchen worktops and bathroom fittings. It also protects against damage or destruction to the other parts of your flat such as the top floor and any outbuildings like garages or workshops. You’ll often find it is covered on your mortgage so you won’t need to worry about that.
Different contents policies will vary as will which parts of your flat are covered. If you have expensive jewellery or work equipment, you will probably want to take out fully comprehensive. These will usually include theft, accidental damage, fire and flooding. Your policy may also include damage to your loft or storage accommodation. If you rent your flat out, some policies will replace all your items at the landlord’s expense so you will be able to continue paying off your mortgage without worrying about whether you have the money to replace your items.
There are a number of different types of contents insurance available to you. Your chosen policy will depend on whether you want to insure your whole flat, or just part of it. Your insurance policy will also be determined by whether you live in a market value area or an area determined by the lender based on your credit status. Market value areas are usually thought to be places where homes are still selling for a similar price to what they sold for a year ago. This is because the demand for homes in this area is lower. If you want to protect your home against future loss, you should consider taking out renter’s insurance to cover the difference between the market value and the agreed value.
Renter’s insurance will not cover you for your entire flat but will usually protect your personal belongings and certain fixed items such as your bed. If you live in an area where your home is of a market value then you may want to consider taking out renters’ insurance to add extra cover for your belongings. The cost of your insurance will depend on the type of policy you choose and will depend on how much you want to insure. If you want to know the cost up front then you should ask the insurance company for a standard quote for your policy. This will help you work out exactly how much you will pay.
If you have a freehold flat, you will also need buildings insurance to take care of your flat. Buildings insurance will usually protect your freehold flat against vandalism and any damage caused by natural disasters such as flooding. However, if you live in a part of the United Kingdom that is not a part of a nation that has a royal leasehold estate then you may need a valuation certificate. A valuation certificate is needed so that the insurance provider can insure your flat at a higher value than the freehold value. You will need to get this certificate before you purchase or rent any property.
Another important factor of any home insurance policy is to check to see how much cover you get for your personal possessions. If you have expensive jewellery then you will probably need a jewellery lock box. Contents insurance will also cover the contents of your flat including items such as furniture, clothing and bedding. Some providers will include a few other things such as washing machines and taps but you will want to check to find out exactly what is included. If you have expensive appliances such as a fridge freezer then you will probably need fridge freezers and ice makers.
Contents insurance is designed to provide cover for all your own belongings, the majority of providers however do not include items that are removable from the flat such as clothing. Contents cover does not usually provide cover for expensive electronic equipment as these are normally protected within your home insurance policy. It is therefore essential that you check your home insurance policy to make sure you have enough cover.