House Insurance UK

There are two different forms of insurance that fall under the household insurance label: buildings insurance and contents insurance. They are often sold together by insurance companies. However, buildings and contents insurance are, in fact, quite different. Before taking out a policy which covers both we advise you to think about these differences and consider whether you really need blanket buildings and contents insurance - which is what most companies will try and sell you - or whether or more tailor made approach might be appropriate.

Buildings insurance typically covers you for damage to the outside of your property and internal fixtures such as fitted kitchens caused by:

- natural disasters such as floods, earthquakes etc
- collateral damage caused by such events (eg from objects brought down in a storm)
- aircraft
- theft or attempted theft
- man made disasters such as riots or demonstrations

You would typically also be covered for your legal liability in the event of someone injuring or - God forbid - killing themselves as a result of being in or on your property (subject to a maximum payout amount by the insurance company).

One of the most important clauses in a buildings insurance policy relates to subsidence. Put simply you are covered for damage to your property resulting from certain types of subsidence but by no means all types (see our 'Policy documents' page for more on this). You are strongly advised to read the section in your policy on subsidence carefully.This is a complicated area of buildings insurance and many people suffer huge disappointment when they discover not only that their house is falling apart but also that the insurance company is able to avoid paying out because of some weasel wording on subsidence in the policy document.

Contents insurance typically covers you for damage or loss of anything in the home which isn't a fixture (eg personal possessions, furniture, pictures etc). The circumstances in which you would be entitled to receive compensation are generally the same as those relating to buildings insurance (egdisasters, theft etc). Similarly you would normally be entitled to receive a payment under a contents insurance policy if someone injures themselveson an item in your home.

By far the most common reason for a claim under a contents insurance policy is theft. As a result, people tend to focus on things that are easily stolen when insuring the contents of their homes such aselectrical items, jewellery and anything else thatis easily moved. Don't lose sight of the fact, however, that some burglaries involve thieves parking a large truck outside your house - normally when you are away on holiday -and systematically removing the contents of your home. So don't just think about the televisions and computers when taking out contents insurance cover. Also pay very particular attention to the clauses in your policydealing with security. You may find that you are not covered at all if you fail to put the burglar alarm on or have inadequate locks on your windows. If in doubt consult the insurance company on exactly what their securityclauses mean before signing up to a policy.

Contents insurance policies will usually pay you the replacement value of any items lost or stolen ifyou make a claim (ie the cost of a new item) but sometimes they will only pay the actual (ie depreciated) value of any items lost or stolen. Make sure you know which applies in your case. There could be a significant difference between the two.

For a fuller description of precisely what is covered under each type of policy see our Policy documents page.

Here are a few things you should pay particular attention to in the context of both contents and buildings insurance: