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When it comes to protecting your property, insurance is as important as keeping it in good repair and in tip top condition.

The cost of premiums, together with the sense that you are not getting anything for your money, does nothing for the popularity of insurance.

However if your property is ever damaged or destroyed the value of insurance is all too clear to see. 

Insurance is not simply worthwhile, it is highly desirable and should never be compromised.

It may seem poor value for money, but it may pay you many times over if your property is ever damaged or destroyed.

So what are the key do’s and don’ts of insurance?

What as a property owner should you do to ensure you get the benefits of insuring?

Here are some of the key points…

1. Ignore any temptation not to insure

Avoid the temptation to save money by not insuring at all.

Paying premiums can seem like wasted money, especially if you have been paying for years and not made a claim.

If money is tight it is tempting to give insurance a miss, but to do so would be risky and foolhardy and you could pay a high price.

2. Ensure premiums are paid

You can minimise the risk of accidentally not insuring by setting up a direct debit or standing order enabling premiums to be paid automatically.

If you choose to pay by cheque or manually upon receipt of the renewal notice, there is a chance you could be late with or miss a payment – leaving you uninsured and at risk.


3. Don’t under insure

Be careful not to under insure in respect of the building (if that is your responsibility) or the contents.

In respect of the building, check with your mortgage company or conveyancer if you are not sure how much to insure for – what policies typically refer to as the “sum insured”.

With contents, carefully calculate the total value of contents and insure for the full amount, being careful not to select a level of cover which is cheaper but realistically too low for your needs.

Where you have individual items of value which should be individually insured – things like watches, jewellery, antiques or the like – make sure you have accurate up to date valuations and seek sufficient cover.

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4. Leaving the property unoccupied

Most home residential policies provide for the insurer to be informed if the property is to be left unattended for an extended period of time.

Check the policy to establish the period or contact the insurer or broker if you are uncertain about the period involved.

Failure to inform the insurer could result in your property being “voided” in the event of a claim for losses – leaving you out of pocket.


5. Duty of good faith

A fundamental legal principle of insurance policies is that they are contracts of “the utmost good faith”.

That means you have a duty to be totally truthful and accurate when completing the insurance proposal form.

If you are uncertain as to the answer to any question, it is best policy to check before answering.

Where you are insuring with the same insurer year after year, be sure to inform them of any material changes in your property on renewal – for instance the fact that you have taken on a lodger.

You will usually be asked to check/compete a “statement of facts” or “statement of insurance” on a renewal; make sure that you read this document carefully and inform the insurer of any change.

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6. Responsibility for insurance

If you own a freehold house you will be responsible for building insurance.

If you own a flat or leasehold house, your freeholder or management company will normally be responsible for insuring the building. If you are unsure as to who is responsible check with the conveyancer who acted  for you when you bought the property.

Where you are not insuring, you should make sure that you obtain a copy of the policy and an up to date schedule of the cover each year.

Whether you are a freeholder or leaseholder you will usually be responsible for insuring the contents of your property 

7. Insuring as a landlord

If you are a landlord insuring a building, you should take out “landlord’s insurance”.

You need to check out what is covered under that term in each individual case, but it will typically include:

  • Building insurance
  • Contents insurance
  • Property owner’s liability
  • Loss of rent in the event of an insured event
  • Rent guarantee in the event of a tenant not paying rent
  • Home emergency cover.

Check that any policy covers you in the event of:

  • Default or wrong doing by your tenant
  • Re-housing costs if your tenant has to move out after an insured event. 


8. Minimising premiums

One of the reasons you may be tempted to give insurance a miss is the cost of premiums.

If you insure with the same insurers for years, they may take you for granted and you may not be offered their lowest premiums.

You should therefore review your premiums annually, checking price comparison websites to see if you can achieve lower premiums elsewhere for the same or better cover.

9. Conclusion

The overriding message is that insurance may seem dull and poor value, but it is extremely important and should be a first priority for every property owner.

Failing to insure or under insuring is a high risk strategy with perhaps the most valuable asset you will ever have and could cost you dear.

Do you have any tips for insuring a property? Have you experienced any of the issues which can occur when a homeowner does not insure adequately? Please leave your comments below.

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Dalton Barrett
Rebel Property Coach

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