Make sure your insurance works for you

Tuesday, 5 March 2019

Let’s be frank. Insurance is boring.

Paying for something you may never need to use isn’t particularly appealing. However it is necessary if you want to drive a car, own a home or run a business. So it’s a boring must-do.

But what is Insurance I hear you say? When you buy an insurance policy you are paying money to transfer your ‘risk’, from you to the insurer. For example, the risk of you leaving your straighteners on and burning down your house (we all know that dread).

Today let’s talk home insurance. If you ever buy a home, you will need to by home insurance as part of getting a mortgage.

1. Don’t underestimate the value of your home.

Most insurers will ask for the cost to re-build your home (rebuild cost) NOT the market value of your home. If you under value your rebuild cost, you will be underinsured. Lots of people fall into this trap as putting in a lower rebuild cost will give you a lower premium – all good until you have to make a claim. Most insurers will only pay a percentage of your claim if you are underinsured. Be smart and insure the correct value.

2. Make sure the policy will cover for your most expensive single item.

The majority of contents insurance policies will have an upper limit for a single items value. This is usually called the ‘single article limit’. Check the small print and make sure it covers you for your most valuable items. Diamonds are a girl’s best friend, insurance is a girls sugar daddy when you lose those diamonds!

3. Don’t get lured in by huge excesses!

The ‘excess’ is the amount you have to pay the insurer if you want to make a claim. For example, you may have a claim for losing a £700 ring, but the excess of £300 has to be paid first. Leaving you only £400 better off when the claim is paid. Be realistic about what excess you are prepared to pay.

4. Use a comparison website to check prices…

…but always check the policy details on the insurers website before buying. Comparison websites only give you the high level details and benefits (a bit like men’s profiles on dating apps).

5. Go for a well-known brand.

Tempted by the 5% cheaper policy from an insurer you have never heard of? Pay a bit more for peace of mind. Insurers have been around for years tend to have more comprehensive policy cover and a more experienced claims service.

If you’ve been putting off buying your insurance policy, this is the sign to get on with it! It’s rare anyone regrets buying insurance, but people always regret not buying insurance.

By @lifeaswomenknow

I fiercely share what it’s like living up to society’s expectations of women. My aim is to help women everywhere find their own voice and self acceptance - not to conform to the boundaries the world tries to put around us.

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