Our guide to contents insurance explains how it works, why you might need it and how to choose the best policy for your needs.
Home contents insurance is a form of home insurance.
Contents insurance, as it’s also known, can help to cover the cost of replacing some of your most valuable possessions.
Put simply, home contents insurance can cover everything you’d take with you if you had to suddenly move out of your home.
It can also include additional items in the home such as carpets
Insurance companies will also cover items taken out of the home, such as smartphones, computers or jewellery
It’s important to shop around for contents insurance to ensure you find the right policy at the right price for you.
Home insurance is a general term used to describe two very different types of insurance, buildings insurance and contents insurance.
The cost of rebuilding or repairing a home
Permanent fixtures and fittings, like kitchens and bathrooms
Computing equipment and TVs
Some types of flooring including carpets
Home contents insurance is often sold alongside buildings insurance as a combined policy.
Sometimes these policies work out cheaper when bought together but price is not always an indication of suitability so always compare contents policies before committing to one.
Contents insurance is not compulsory. Even so, it is a good idea to have home contents insurance, as replacing items that are damaged, lost or stolen – such in a burglary - can be very expensive.
According to the Association of British Insurers (ABI) the average home has contents worth £35,000 (ABI 2018).
As well as obvious items of high value there may be other items in the home, such as food stored in a freezer, that can also be costly to replace. These are often also covered by a standard home contents insurance policy.
All insurance companies charge an excess; this is the amount you pay before you claim on your policy. For example, if you make a claim for £500 and your excess is £200, you will have to pay the first £200 and then claim the remaining £300 from your insurer.
You can normally insure anything in your home that is not physically attached to the building, including:
Different policies will offer different levels of cover, but most types of home contents insurance cover help you pay to replace possessions which are damaged or lost as a result of theft, fire and/or flood.
There are optional extras insurers include in some home contents cover, but you will have to pay extra. These include:
Accidental damage cover – for example if you knock your computer over and damage it
Personal possessions cover – this includes items you take outside the home including laptops, cameras, jewellery, and mobile phones
Cover while abroad - some insurance policies will also cover you when you go abroad
There are 2 different kinds of home contents cover and which one you choose will determine the premium you pay.
This cover means you’ll get paid what it costs to replace the items – apart from clothes and bedding/linen where you need to allow for wear and tear.
You’ll only be able to claim back the current value of your possessions if you choose indemnity over.
It is cheaper than new for old cover but it means you may struggle to replace some items if you have to make a claim; for example if you claim for a sofa bought for £3,000 you may only be able to claim back the value, which may only be £300.
To help you choose the right cover we’ve listed what cover to expect both as standard and as additional extras.
Home contents insurance will cover items of value including jewellery, watches, gold or silver, works of art, cameras, TVs, computers.
However, most insurers will set a total limit on what you can cover and there will be a single item limit on ‘high risk items’ such as jewellery, pieces of art, watches and laptops.
This single item limit on the value of any one valuable item (such as a piece of jewellery or a painting, for example) tends to be set at £1,500 or more
If you have any high-risk items consider taking out separate cover for them
Cash that you keep at home is covered against theft or damage up to a limit of £500.
If your fridge or freezer fails or breaks down and food is spoiled, this covers you for the cost of replacing the contents - most insurers will cover up to £300.
If the food is spoiled as a result of a power cut, you should be able to make a small claim for the cost of replacing it through your energy supplier.
This provides cover for loss or damage to contents in an outbuilding or garage. You will also be covered for items left outside, so long as they are within the boundaries of your home.
Cover will not normally include garden furniture, ornaments, plants or shrubs.
This will pay out, normally up to £2 million, if you have to pay damages as the result of a claim made against you for accidental injury to someone or loss or damage to their property.
Some of the cover we’ve outlined below is included as standard in some home contents insurance policies, but some insurers will charge an extra premium to include it.
This covers you against the cost of accidents that might damage the contents of your home, although there are some standard exclusions, such as damage caused by pets.
If you suffer an accidental leak, then this cover will allow you to claim back the cost of any metered water you’ve lost.
This means you are covered for the effect of inflation on the cost of replacing your possessions. If you have many high-value items, you may want to pay an extra premium to increase the sum assured.
There are occasions when you are likely to have more contents of value in your home than usual, such as Christmas or a family wedding. You can choose to increase your cover to include special events.
This is known as an ‘all risks’ cover and allows you to cover personal possessions whilst they are outside of the home. This can include cover for holidays or travel abroad but your insurer may limit the cover to a set number of days per year.
If you have a lot of bought content on your phone or computer, such as music files or downloaded films then you may be able to extra cover in case this is also lost. It is not a standard inclusion so you will need to check with your insurer.
This covers you for personal legal problems from property disputes, employment disputes, or injury claims.
Cover will give you access to legal advice and can also cover the legal costs of claiming compensation following an accident that was not your fault.
It can also fund legal actions, such as employment or neighbour disputes.
The insurance company guarantees any repairs to your contents so long as you use a company recommended by the insurer.
This provides you with a 24-hour helpline and the cost of calling a tradesman out to deal with an emergency, such as a broken boiler.
Cover will pay for repairs and labour and you can add in overnight accommodation costs if you cannot stay in your home.
This covers you for loss or damage caused by fire, vandalism or theft to plants, trees, shrubs and lawns.
If you lose your keys or have them stolen, this covers the cost of replacing the locks.
You can choose to cover office equipment such as computers, printers and furniture.
If you work from home, let your insurer know so they can make sure you have the right level of cover, normally £3,000 or more.
There will be an excess to pay if you claim on your policy.
Contents excess – this is the amount you will pay if you make a claim and will be set by the insurer. You can choose a higher excess in return for a lower premium but you will have to pay more should you make a claim.
Accidental damage excess – if you have accidental damage cover this is an extra excess you will have to pay
Home contents insurance does have exclusions, these would include:
Wear and tear of possessions
The structure of your home – this is covered by buildings insurance
Damage to a computer caused by a virus.
Claims that exceed the value of a single item limit – normally £1,500
According to the Association of British Insurers, home contents insurance costs the average family £139 a year.
But what you pay will depend on:
Your claims history – if you have made previous claims you may be charged more
Value of your contents – having a large number of higher risk items such as jewellery will increase the premium
Where you live – if you live in a high crime area you are considered riskier to insure
Security measures - insurers may insist you have adequate security such as front doors that double lock, or they may offer premium discounts if you have additional security
When you insure your possessions, you should first value them based on what it will cost you to repair them as new.
First list everything you own
Add up what it would cost to replace every item if bought new
Make a note of high value items and let your insurer know, especially if they are worth over £1,500 – some insurers will allow for larger amounts
Always get enough cover to replace all your possessions.
There are 3 ways insurers price home contents insurance.
In this case you are insured based on the number of bedrooms you have. Most bedroom-rated policies provide between £40,000 and £50,000 of cover as standard.
In this case you have to calculate the amount of contents cover you need and pass this onto your insurer.
In this case your contents are covered without limit, but your premiums will be more, and you could be over insured.
You need to make sure you inform your insurance company of large purchases, for example jewellery or if you choose to replace all your furniture.
If you take in a lodger, you also need to let your insurer know as this could invalidate your policy.
When you are looking for home contents insurance have these details to hand. The more details you have to hand, the quicker it will be to get a suitable quote.
Your current home or contents insurance policy documents
The value of your contents
Details about any high-value items
Details of any previous claims