It’s getting really easy to buy insurance online, almost too easy, and you may think that’s a good thing. But what do you really know about the insurance you’re buying? How do you know it will cover your own specific circumstances, and what happens when things go wrong?
Why Do You Need Home Insurance?
Insurance is an incredibly important purchase, especially a cover that protects your most valuable personal asset – your home. The problem is, however, as it’s such an intangible product, you don’t really feel the benefit until it’s needed, by which point if you’ve had the wrong cover in place you could find it’s too late.
Insurance brokers can train for years and some take industry qualifications. They work in a highly regulated financial environment, yet many people still leave their insurance cover to a quick search on a price comparison website where, let’s be honest, the primary focus is often “how cheap can I get it?”.
That’s nonsensical. Let’s say, for example, you needed to buy a parachute, would you pop on eBay and filter to “lowest price first” or would you speak to an expert and understand your options fully, making an informed and sensible choice? Okay, so that might be a tenuous example to some extent, yet every year, tens of thousands of people just go online and search for cheap home insurance without giving it a second thought.
It’s easy for us to say you should use a broker rather than buy home insurance online, but let’s look at some real scenarios and areas where you could really trip up when it comes to buying the wrong insurance and end up costing yourself a lot more than a cheap insurance policy.
Ranges of Cover
First of all, cover levels. Insurance policies can come with different covers and levels of cover. Often what happens when an insurer tries to offer cheap insurance is to reduce the levels of cover, sometimes strip out some of the covers all together. You may think you’re buying the complete protection, but it could turn out not to be.
Some of the covers you might find are not covered as standard are:
- Accidental damage
- Family legal protection
- Home emergency cover
- Personal possessions cover (away from the home)
If you don’t want a stripped down policy but a great deal on a policy that suits your needs and includes some of these options, an insurance broker will be able to search the market and find a policy best suited to your personal requirements at a competitive price.
What Are The Risks?
Secondly, we have underinsurance. This is all about not covering enough of your home and this can happen in two main areas. Buildings and contents. Let’s look at contents insurance. How much is your contents worth? Do you know? Have you added up all your clothes and expensive items? How much will it cost to replace them new for old? Some online insurance price comparison sites will suggest an amount of contents, but that could be too low. An insurance broker will help you correctly calculate your contents insurance by taking you through common areas that are often overlooked.
As you can be underinsured, you can also be overinsured. One of the most common areas for this to occur is with your buildings insurance. How much would it cost to rebuild your house? Not how much it is worth, but how much would it cost to build from scratch. In most cases location and proximity to good schools become irrelevant, this is the cost of the bricks and mortar alone. If you over estimate your building’s rebuild sum, then you could end up paying too much for your insurance. As with your contents cover and making sure you’re not underinsured, an insurance broker would be able to assist you when calculating your sums insured to make sure you’re working out the right figure and find a policy to suit.
If you get your insurance wrong, for example, find yourself underinsured, insurers will often employ the condition of average. This is where when the sum insured is inadequate, the insurer can reduce the amount they have to pay for a claim by applying a proportionate approach. While this may seem less than ideal, it’s preferable to having the policy voided. Using a good insurance broker will help you avoid falling victim to this.
Sometimes, if not most of the time, you may find insurance policies come with an excess to pay. On some cheaper online policies, these can be higher to offset the saving on the premium. An insurance broker would be able to point these out to you and find you a policy with an affordable excess, and in some cases offer excess protection as an additional level of cover.
Do you know what the claims service is like with your online insurance provider? A price comparison website is not going to help you when it really matters, but a good insurance broker will assist you with claims. To some extent dealing with insurers on your behalf to get you a fair pay out. This could save you a lot of time and money.
Use An Insurance Broker
A good insurance broker will be able to search their market, as good as any price comparison website, and will look at insurance cover that is right for your circumstances. You can discuss your requirements with a broker. What is important to you? What elements must you have in your policy? They can spend the time to find the right cover and at a competitive price. Insurance brokers like Coversure forge very strong relationships with insurers to try and get their customers the best rates possible.
So next time you’re looking for insurance for your home, don’t just search for the cheapest deal online. Speak to an insurance broker. It may very well work out cheaper for you in the long run. Click here to contact your local Coversure office, who will help with your home insurance needs.