Typical cover provided
The buildings section of a household policy is designed to cover the structure of the home including additional elements, such as walls, fences, paths and driveways, garages, outbuildings and fuel storage tanks. The term 'buildings' is specifically defined in the policy wording.
All insurers provide cover for damage caused by a range of perils, including:
fire, lightning, explosion and earthquake
riot, civil commotion, strikes, labour or political disturbances, malicious damage or vandalism
storm and flood
falling trees or branches
escape of water or oil
theft or attempted theft
subsidence, ground heave or landslip
falling television or radio receiving aerials, their fittings and masts.
A number of other items are automatically included in the cover provided, such as:
accidental damage to services
accidental damage to fixed glass and sanitary fittings
legal fees, architects' and surveyors' fees and debris removal costs incurred following damage to the buildings
loss of rent or the cost of alternative accommodation
repairs to plumbing after freezing
repair of damage following forced emergency access
sale of the home, giving the purchaser the benefit of the insurance up to the date of completion
replacement of locks following loss or theft of keys
the cost of tracing leaks following an escape of water causing damage to the home
The contents section of a household policy covers any household goods and personal possessions belonging to the insured or members of their household or for which they are legally responsible. Certain items of property are specifically excluded, such as securities, certificates and documents and livestock and pets.
Tenant's fixtures and fittings and a limited amount of business equipment are also covered, where applicable.
Insurers usually place limits on single articles of value (between £1,500 and £2,000), the total amount of valuable items (one third of the contents sum insured or a fixed amount of £7,500) and money (£300 - £750).
The perils covered are largely the same as those covered by the buildings section, subject to minor variations in the wording. The main difference is in relation to theft cover, where loss of money or credit cards and loss or damage while the home or any part of it is let or sublet, must involve the use of force and violence.
A number of other items are automatically included in the cover provided:
temporary removal of contents
contents in the garden
accidental damage to the contents during household removal
accidental damage to fixed glass and mirrors
accidental damage to entertainment equipment
the cost of alternative accommodation following insured damage
loss of heating fuel or metered water
the cost of replacing external door locks and keys, following the loss or theft of keys to the home
temporary increases in sums insured to cover, for example, wedding gifts and gifts and food bought for Christmas or other religious festivals
loss of title deeds.
Cover is most commonly provided on a 'new for old' basis where the full cost of replacing the property as new is paid, subject to the limit of the sum insured. Sums insured are usually index linked, so that they rise in line with inflation.
All buildings and contents household policies automatically include liability cover.
The buildings section covers liability arising out of owning the home, including liability incurred under the Defective Premises Act 1972.
The contents section covers liability arising out of occupying the home. The insured's personal liability as a private individual, liability as an employer of domestic servants and liability as a tenant, where applicable, are also covered.
A limit of indemnity (typically £2 million) applies to any one claim. If the claim involves an employee being injured or falling ill, the limit of indemnity is usually increased to £10 million.
Buildings and Contents
The main optional extension to buildings and contents cover is full accidental damage cover.
In addition, there are a range of optional sections of cover which can be added to a household policy, including:
personal possessions: all risks cover for personal possessions regularly taken outside the home
money and credit cards: accidental loss of money and/or loss due to fraudulent use of credit cards
pedal cycles: accidental loss of or damage to pedal cycles and accessories
sports equipment: accidental loss of or damage to sports equipment and specialist sports clothing
frozen foods: loss of or damage to frozen foods due to a change in temperature or contamination by freezing agents
legal expenses: the legal costs involved in taking legal action against third parties or defending claims against the insured
home emergency: the cost of call out, labour and parts in the event of a home emergency
assistance services/emergency helplines: 24 hour helpline covering legal advice and emergency assistance with repairs.
Each of the perils and extensions are subject to specific exclusions. Monetary limits also apply to many of the policy extensions.
In addition, there are exclusions which apply to all sections of a household policy:
failure of computer equipment to recognise the true calendar date
confiscation of property
existing damage which arose before cover started