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How much home insurance do you need?

It's important to protect the things you've worked hard for. Home insurance can help make sure you’re covered, should something unexpected happen. 

We can help you:

  • understand what home insurance covers
  • calculate how much home insurance you might need

Do you need home insurance?

Home insurance protects you, financially, by paying for replacements or repairs if something happens to your home or belongings. For example, if they're damaged in a fire or a flood, or if your things are stolen.

If you rent: you may want to consider contents insurance to help you cover the costs of replacing your possessions if something happens to them. You won’t need to worry about buildings insurance as that will be the responsibility of your landlord.

If you’re a home owner: most mortgages require you to have buildings insurance. And whether you have a mortgage or not, buildings insurance can help you protect the value of your home and contents insurance can cover your belongings.

Building insurance

Building insurance typically, covers: 

  • the structure of the building (bricks and mortar)
  • permanent fixtures and fittings such as kitchens, baths and built-in cupboards
  • outside buildings such as garages, greenhouses and garden sheds

 

Buildings insurance may not cover:

  • boundary walls, fences, gates and paths 
  • damage caused by general wear and tear
  • legal expenses for property-related disputes (unless you’ve taken out additional cover)

As an optional extra, you may want to consider home emergency cover. You may be able to buy this as an add-on to your buildings insurance or as separate policy.

Contents insurance

Contents insurance, typically, covers: 

  • items in your home that you’d take with you if you moved, such as furniture and white goods
  • carpets and curtains 
  • garden equipment 

 

Contents insurance may not cover: 

  • wear and tear
  • accidental damage 

 

You can usually get additions to your policy to cover items you take outside your home, such as laptops, jewellery and mobile phones.

Calculating how much home insurance you need

How much buildings insurance do you need?

You should consider having enough buildings insurance to cover the amount it would cost you to rebuild your home from scratch. This is known as the ‘sum insured’.

This isn’t the same amount as the price you paid for the property, or how much it’s currently worth. The rebuild cost is usually less.

If you recently made a mortgage application, you’ll have received a valuation which includes a rebuild cost. If not, you can use the rebuilding cost calculator from the Association of British Insurers (ABI). 

Some insurers may estimate this cost for you based on the number of bedrooms you have, or provide an unlimited value so you don’t need to specify the rebuild costs.

Keep in mind:  

  • home improvements, such as adding an extension or conservatory, can increase the rebuild cost
  • rebuild costs can be higher for ‘non-standard construction’ properties
  • rebuild costs can increase over time – most policies are index-linked meaning they adjust to reflect increasing costs, but it’s something to check when you renew to make sure you have enough cover

How much contents insurance do you need?

It's important you don't underestimate how much your belongings are worth. If you ever have to replace them, you’ll need enough contents insurance to cover your losses.  

To work out the value of your contents, you can:

  • make a list of items in each room of your home, including the loft or garage
  • estimate how much it would cost to replace each item with a new one
  • add up the cost of all your items to get your estimate 

 

Many websites offer contents insurance calculators to help you do this. 

The price of most items can be searched on the internet, but for things such as antiques, or a valuable piece of jewellery, you may want to get these valued by a professional. 

Some insurance policies have a limit on how much you can claim on a single item, so you may need to add extra cover for any items that exceed that limit.

How much is home insurance?

The amount you spend on home insurance will depend on the type of property you have and the value of your contents. It’ll also depend on the level of cover you need and if you add any optional extras.

For example, HSBC Home Insurance gives you a choice of different levels of protection for your home and contents. You can increase your cover by adding accidental damage, home emergency or legal protection. 

You can also add gadget, mobile phone and home emergency cover as part of our multi-insurance policy, Select and Cover. Cover starts from £19.50 per month for 3 options and there’s 7 different types of insurance to choose from. 

Select and Cover is available to HSBC UK customers who are registered for online banking.

Before you buy any insurance product, it’s important to read the policy and understand the details including costs to make sure you get the cover you need. 

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