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Everything you need to know about renters’ insurance

Everything you need to know about renters’ insurance
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Moving into a new home is a busy time, but it pays to make sure your renters’ insurance is organised. UK insurers provide protection for residents’ belongings whether they rent or own their home.

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What is renters’ insurance for?

Landlords will have buildings insurance for the property itself, and probably contents insurance too, especially when letting furnished accommodation. However, this does not cover their tenants’ belongings.

In the event that personal items are stolen or damaged, renters’ insurance will pay the cost of replacement. Each policy will be slightly different, but in general, this insurance covers gadgets, electricals, clothes, jewellery, a limited amount of cash, furnishings and the contents of the freezer.

Most policies include renters’ liability. This protects tenants against the cost of replacing items owned by the landlord. For example, if you are careless with the landlord’s pricey ceramic hob, you won’t want to pay the repair bill with your credit card. Not all landlords with clumsy tenants have accidental damage cover! 

How much should renters spend on insurance?

In the UK, when choosing a renters’ insurance policy, it’s important to think carefully about individual circumstances. If you’re a minimalist, a very basic policy may provide everything you need.

Some items will need personal possession cover. For example, if you own a top-of-the-range musical instrument and perform at various venues, it’s best to make sure that the policy would protect it outside of your home.

Some specific items may need extra cover because they are especially expensive to replace. It will be necessary to be precise about the value to make sure that you are adequately covered. 

It’s possible to find a renters’ insurance policy for as little as £50 per year in the UK. The price varies depending on the overall value of possessions, the security of the property, who lives in the house and whether you have made any claims before.

How can I find the right renters’ insurance policy in the UK?

Renters’ or tenants’ insurance – which UK insurers sometimes just refer to as contents insurance – is simple to arrange. Adding extras is voluntary, such as tenants’ liability for damaging the landlord’s possessions.

Another option to look out for is cover in case your home becomes uninhabitable. This would pay for alternative accommodation, such as a hotel. 

As with all types of insurance, it is advisable to compare prices, bearing in mind excesses and level of cover. Insurers can be contacted directly for advice.

Filling in your details on comparison sites can help you compare policies and identify your requirements and what you can afford. Once you know exactly what you need, you can then shop around with other insurers. 

Be prepared to answer lots of detailed questions about the type of property, including what kind of lock there is on the door.

Do lodgers need renters’ insurance in the UK?

Contents insurance seems more complicated when a householder lives with one or more lodgers.

If you are renting a room in someone’s house, it is wise to keep an inventory of your own possessions for insurance purposes. Separate renters’ insurance is required, as the landlord’s contents insurance will only cover what they own. 

Who should be listed on the policy?

If you are not related to the people you live with, then it is better to have separate policies, rather than one to cover all.

As with car insurance, adding extra people to insurance will usually cost more, especially if they smoke or have a criminal conviction. Whether the insurer requires names or not, you need to provide information about each resident adult, no matter who takes out the policy.

It is advisable to check that there are no penalties for changing or cancelling your renters’ insurance policy, as tenants’ accommodation arrangements can change unpredictably. For example, if you are living with a partner or sibling, you may still want to insure valuable possessions separately.

Is it worth it?

It’s not compulsory to get renters’ insurance in the UK – tenants can get by without.

Calculate how many months it would take to save enough money to replace your most expensive items. Then compare the cost of the premium with that. The more you own, the more you need insurance.

When you want to make a claim, contact your insurer promptly, and seek advice if you are not satisfied.

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