Take a moment to think about your home. If you own the property, think about all the brick and mortar structures that make up your property. If you are renting, think about all the items you bought over the years. If you calculate the value, you have probably spent tens of thousands of pounds.
Now think about what would happen if all this went up in flames. How would you start over? Where would you even start? The risks to your home are ever present. Fire, flooding, burglars can all reduce your home to a shell within minutes.
Taking up insurance is the only way you can be sure you will recover from such losses. Here we cover the top three insurance covers you must have to protect your home.
- Mortgage Payment Protection Insurance
Mortgage payments are a long-term commitment. If your mortgage term is 20 years, you must hope nothing happens to you or your job during this period. But accidents do happen. If this results in your death, what happens to your mortgage payments? You cannot assume your family will be able to manage them.
Abbreviated as MPPI, mortgage payment protection insurance will help pay off your mortgage in such an eventuality. MPPI will also cover your payments if an illness or accident prevents you from working.
Before taking an MPPI policy, there are several factors you must consider such as the maximum payout the policy will make. To find out more, MeetFabric published an exhaustive blog post that covers all the pros and cons of MPPI.
- Buildings Insurance
Buildings insurance can be taken out either by a property owner or a renter. In either case, the insurance policy will cover all the physical structures in the property. This includes the main house and, in some cases, adjacent structures such as a garage or shed.
Buildings insurance is mostly taken out by the property owner as they are liable to maintain these structures in any case. As a tenant, you may wish to take buildings insurance if you have made some modifications to the property.
This could be for instance a shed you have built on the property. Buildings insurance will pay out if the structures of your property become damaged by fire, flooding or any other accident.
- Contents Insurance
As the name indicates, contents insurance covers everything inside the property. This includes sofa sets, televisions, kitchen appliances, washing machines, treadmills, etc. The policy even covers personal items such as clothing.
As a property owner, you may wish to take this cover if you rent out your property fully-furnished. As a renter, taking out contents insurance makes perfect sense. As you are only liable for what is inside the house, this cover will compensate you if your items get stolen or destroyed.
Contents insurance can also be customized to cover valuable items such as art and jewelry. These will, however, increase the premiums you pay.
Owning or renting a property comes with attendant risks. Mitigating these risks is essential if you want to keep your home at the same level of habitability it currently has.
If you own the property, you obviously would not want a property to burn down – but even more importantly, the last thing you need is to lose income and gain major headaches.
As a renter, if your possessions get stolen or destroyed, this could bring you to a financial crisis as you try to rebuild your life. These three types of insurance are the practical answer to both scenarios.