Contents Insurance
Contents insurance is insurance that pays for damage to, or loss of, your personal possessions whilst they are located within your home. Some contents insurance policies also provide restricted cover for personal possessions temporarily taken away from the home by the policyholder.
In this context "possessions" means anything that is not permanently attached to the structure of the home. (Possessions that are permanently attached to the structure of the home can only be insured via home insurance.) Some contents policies may also include possessions kept in outbuildings or in the garden area attached to the house.
Contents insurance is usually sold alongside home insurance but it can also be purchased as a stand-alone policy, especially for those who are renting rather than owning their home.
It is important that you don't under insure the contents of your home. Most policies will ask you to define a ‘sum insured' – this will be the maximum your insurer will pay out.
The best way to avoid this is to create a checklist of absolutely everything you have in and around your home. Be sure to include things you have made and anything that has been given to you because these things will need to be replaced. Try to include an approximate date when the items were bought and save any receipts you might have. It might sound like a lot of hassle but well worth the effort to ensure that the contents are insured properly.
Remember about the limit insurers could place on individual items, as it could be lower than some of your possessions. If this is the case you have three options:
Negotiate for the full value to be included.
Insure the item separately.
Break the item down into components of lower value where possible, for example: a camera can have a lens, the main body and peripheral equipment insured separately.
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