Home contents insurance is another type of policy that protects homeowners. It’s similar to basic fire insurance in that it protects your home against the same causes of damage except for one important difference – this policy insures your home contents and any renovation work.
There are actually two different types of home contents insurance available:
- Insured Perils: Covers damage ONLY caused by the causes stipulated in your policy documents such as fire, lightning, explosions, etc.
- All Risks: Covers a wider range of causes and even includes damage caused by accidents, but there are exclusions in this policy.
What Does Home Contents Insurance Cost?
Because home contents insurance covers your valuable possessions and renovations, the premium won’t be as cheap as that of your basic fire insurance policy. Thankfully, there are many insurance providers that can offer competitive policies with adjustable levels of coverage.
So you can expect to pay annual premiums ranging from $70 – $400+ depending on which insurance company you buy insurance from – so compare policies until you find one that fits your coverage requirements and budget.
What Does Home Contents Insurance Cover?
Depending on what options you choose, your home contents insurance policy covers the following:
- Household Contents: Includes your valuable furniture, appliances, clothing, linens, electronics, AV equipment, jewelry, etc. But there is an insurance limit (ex. $1,500), so if you have VERY expensive items (wine bottles, paintings, investment timepieces), you’ll need to get an endorsement in your policy to cover them.
- Renovations, Fixtures, and Fittings: Protects the investment in your home’s renovations such as bathroom/kitchen modifications, air conditioners, wardrobes, flooring, etc.
- Personal Legal Liability: Covers medical expenses or property damage you accidentally cause a third party.
- Alternative Accommodation Expenses: Provides financial assistance in the form of a weekly/monthly stipend to cover the cost of alternative accommodation while your home undergoes repair.
- Accidental Glass Breakage Coverage: Covers the replacement of damaged glass in your home to light fittings, mirrors, and glass in furniture.
- Loss of Personal Money/Debit/Credit Card: Provides coverage for the loss, theft, and replacement of credit or debit cards. It can also cover any unauthorized use of your cards in case purchases were made before you cancelled them/notified the bank.
- Loss of Personal Papers: Covers the replacement cost of your lost/destroyed identification card(s) or Passport.
- Accidental Death of Pet: Provides payment for the loss of your pet in the event of an accident.
- Worldwide Accidental Death: Enables you or your beneficiaries to receive a death benefit in the event that you or your spouse accidentally dies while on holiday.
- Worldwide Personal Effects: Insures valuables such as electronics, jewelry, and watches against theft or loss when you travel abroad.
- Rent Protection: Reimburses you for the loss of rental income if your tenant defaults on rent or absconds as a result of damage to the property.
Evaluate Your Home Contents Insurance Policy Annually
A lot can happen within the span within a year. You might purchase a new television, sounds system, stove, or even renovate part of your home. If you already purchased a home contents insurance policy, any damage to items not listed in your policy won’t be covered – unless you add them in first.
It’s better to add big purchase items and renovations to your policy as soon as possible. But if you evaluate your policy annually, you can add them in during your review.