Insurance World

Contents insurance is something that most people who own or rent a home will take out in their lives. However, many people don’t get adequate cover or pay too much for their insurance. If you are unsure how to get the best contents insurance deal then this article can help you.

Why get contents insurance?

Contents insurance is important because it protects your valuable possessions in the event of damage or loss. Contents insurance will protect the items that you own from severe weather, theft, fire, flooding, civil disorder and impact from vehicles or trees. Although many people never have any of these things affect them, the unexpected can always happen and it pays to have contents insurance in place. If you cannot afford to lose something then it should be insured.

Types of cover

There are two main types of contents insurance cover available. One is called indemnity cover, and will replace items whilst taking into consideration their condition and general depreciation. The second and more comprehensive type of cover will replace any damaged or lost items with brand new items at the current market value. Obviously, the latter policy will be more expensive but will cover you more comprehensively, and you should opt for this type as long as you can afford it.

Special features

Many contents insurance policies have special features, such as cover for legal expenses, cover for food spoilage or cover for garages and outbuildings. Obviously the more comprehensive the cover then the most expensive it will be. If you want to keep your premiums low then remove any special features that you think you can do without.

Getting the best deal

Getting the best deal for your contents insurance involves some research and a lot of shopping around. Before you look for insurance, decide how much your possessions are worth so that you know the level of cover that you need. If you are getting an old items for new items policy, then value the items at their replacement value, not at the value they are currently worth. Once you have decided on an amount you can shop around for the best deal.

Look at both online and offline lenders to find the best deal. If you find that the amount of cover you need is beyond your financial means, then start to work out which items are more essential than others. Eventually you will find the right balance between premium costs and coverage level.

Keeping up to date

After you have contents insurance, it is important to keep the policy up to date. If you buy any new items of significant value, then make sure they are added to the policy. Also, if you move house you should check with your insurance company that you will be covered when your contents are being moved.

Security

One of the best ways to reduce premiums and also reduce the risk of having to claim on your insurance is to make sure your home is safe and secure. Get an alarm system, check all doors and windows and address any security issues that your property has. This will help you to get the best deal for your contents insurance.

According to the Association of British Insurers we can expect, over the next 50 years, an incredible 150% rise in the number of car drivers aged 70 and over, who hold a full driving licence. The fact that the “baby boomers” are now reaching retirement and people are generally living longer is a major factor in this calculation.

They also forecast that this group of older drivers will go from the present approximately 4 million to over 10 million by 2050. It is expected that the number of drivers of other ages will remain fairly constant. If this is correct then by 2050 nearly 40% of the driving population will be aged 60 or more and nearly a quarter of then will be over 70!

The Government has been requested by the ABI to consider the possibility of medical and eyesight tests to be carried out on a regular basis.

As far as insurance is concerned, risk levels are extremely difficult to measure as driving skills are liable to deteriorate over the years, due to a gradual decline in both health and eyesight. The deterioration is particularly noticeable once the driver has reached the aged of 80. This leads to slower response times and therefore puts these people at a much higher accident risk. It also makes recent driving experience, normally a key part in working out risk, less relevant as drivers get older.

The ABI say that the numbers of claims made by older drivers are inclined to worsen with age and that the drivers themselves are more likely to be badly injured or killed if they’re involved in an accident. Claim costs rise with age and are 50% higher for a driver of over 80 than for one aged 60.

No wonder, then, that some older drivers are beginning to have problems with obtaining suitable insurance. There’s no need to panic though, it appears that virtually all insurers will continue your current cover without applying age restrictions. It doesn’t follow that this will give you the best deal, though, and it’s good to obtain a few alternative quotes from time to time.

Currently the insurance market for these drivers is relatively small but as the numbers increase then more insurance companies will join in the competition and specialized firm will join those already offering this type of cover. It’s obviously going to be a fast-growing market.

At the other end of the scale, Norwich Union has just launched a “young drivers” policy for its current customers. As young drivers have a ten-fold chance of a serious accident at night time, there is a charge of Ј1 for each time they are out on the road between 11pm and 6am.

This is part of a host of new, up to date policies being introduced in an effort to gain new customers, whilst keeping down the costs of insurance.

If you’re willing to pay Ј475 excess, waive your no-claims discount and courtesy car, for instance, then you can expect to save 12% against the normal fully comprehensive cover quote from Tesco, with their new “Value” policy.

Direct Line is another company with some new ideas, such as allowing motorcyclists to transfer no-claim discounts when purchasing a car. Also they have a policy that lets family members build up no-claim discounts on each others’ cars, and offers a discount if all householders insure their cars with them.

Check carefully before jumping in with one of these new policies, however, as the big insurers will normally let you cut your costs by opting out of some of these measures. For instance, if you were to raise your excess and maybe forego your no claims protection, this would make a great deal of difference to your premium.

It’s a fast changing scene and certainly not easy to keep up with, whatever your age. The best advice we can give is to get online and find an insurance broker. They will take into account all your circumstances and compare a number of insurance companies to obtain the best deal to suit you, at the most competitive price. You’ll get your online discount too.