When you take out home insurance, you obviously want the best deal on the market. With this in mind, many ask friends and colleagues about their insurance policies. Although they may offer some good recommendations, be wary – there are many rumours surrounding home insurance that are just that – rumours, and not facts. Here are just a few myths about home insurance you may find yourself faced with:
I’m at home all day, so there’s a lower burglary risk. My policy will be cheaper
Some insurers charge higher premiums if you are in your house more often, since you are more likely to cause damage to your property if you are actually in it. Remember, home insurance isn’t just to cover criminal damage, but also to cover wear and tear.
It’s cheaper to buy direct from an insurer
Many people believe that buying home insurance via a comparison company or brokerage firm means that the intermediary’s fee will raise the cost of insurance. This is not necessarily the case, as many companies have a special arrangement with brokers and comparison sites because of the sheer volume of custom they can bring. Investigate all of these options when you are looking for insurance.
If my pet damages my home, then I can claim on my insurance
Actually, this is sometimes true. If there is an accident, such as a dog jumping up and knocking over a TV, as long as you had taken reasonable steps to secure and balance the set, you should be able to claim for a replacement. However, if your cat has convinced itself that your table is a scratching post, there is often nothing you can do via the insurance company. I’d suggest some pet re-training.
I have to lower my cover to get cheaper premiums
It’s a bad idea to leave yourself underinsured and the amount of extra money you will end up paying, to replace or repair items, is highly unlikely to be worth the decrease in premium payments. A much better way to lower your payments is to have additional security measures, such as burglar alarms or London bars, fitted to your home. You can find out which measures would be most effective by talking to an insurance expert or to your local police.
My company won’t pay out for an ‘Act of God’!
Some companies have a clause to relieve them of liability for natural disasters, such as storms or earthquakes, but this varies from insurer to insurer and from location to location. The only sensible step to take is to find a fully comprehensive home insurance policy that will cover any eventuality you may encounter, given what’s most likely to encounter in your part of the world. Read all terms very carefully before you commit yourself to an agreement, because no one wants to be greeted with an unwelcome surprise at the worst possible moment.
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Max Freedman writes regularly on finance-related topics for a digital marketing agency. He’s especially interested in personal finance and strategies for saving money.