Contents insurance protects the belongings inside your home against risks such as theft, fire, flood and other events covered by your policy.
It can cover possessions including furniture, televisions, computers, clothing, jewellery and other personal belongings. Buildings insurance, by comparison, protects the structure of the property itself.
If you’re buying a home with a mortgage, buildings insurance will normally be required by your mortgage lender. Contents insurance isn’t usually compulsory, but that doesn’t necessarily mean you should overlook it.
After paying a deposit, legal fees, moving costs and potentially thousands of pounds for furniture and appliances, replacing your possessions following a burglary, fire or flood could create a significant unexpected expense.
Quick Answer
Contents insurance can pay towards repairing or replacing your belongings if they’re lost, stolen or damaged by something covered by your policy. Homeowners often arrange it alongside buildings insurance, while renters usually only need to insure their own contents.
In this guide, we explain what contents insurance covers, what it doesn’t cover, how much cover you may need and when to arrange it when buying a home.
What’s the Difference Between Buildings and Contents Insurance?
| Usually Contents | Usually Buildings |
|---|---|
| Sofas and Furniture | Walls and Roof |
| Tvs and Computers | Windows and Doors |
| Clothing | Fitted Kitchen Units |
| Jewellery | Bathroom Fittings |
| Freestanding Appliances | Permanent Fixtures |
| Books and Artwork | Structural Elements |
| Personal Belongings | The Building Itself |
A useful way to think about it is that buildings insurance generally covers the structure and permanent fixtures, while contents insurance generally covers the belongings you would take with you if you moved home.
What Does Contents Insurance Cover?
Contents insurance can cover personal belongings in your home if they’re damaged, destroyed, lost or stolen following an event covered by your policy.
Depending on the policy, this can include:
- sofas, beds and other furniture;
- televisions and electrical equipment;
- computers and laptops;
- clothing;
- kitchenware;
- books;
- carpets;
- artwork;
- jewellery and watches; and
- other personal possessions.
Policies commonly provide protection against risks such as fire, theft, flooding and escape of water, although the exact events covered vary between insurers.
Additional cover may also be available for accidental damage, valuable items and belongings taken outside the home.
Always check the individual policy wording because insurers can apply different limits, conditions and exclusions.
How Does Contents Insurance Work?
If something covered by your policy happens, you make a claim with your insurer.
For example, imagine a serious escape of water damages your sofa, television, carpets and other possessions. You would normally contact your insurer, which would assess:
- what happened;
- whether the event is covered;
- which belongings were affected;
- the value of the loss or damage;
- any policy limits or exclusions; and
- the excess you need to pay.
The excess is the amount you agree to contribute towards an eligible claim. The insurer then deals with the remaining covered amount, subject to the policy’s terms and limits.
Depending on the policy and the claim, damaged belongings may be repaired or replaced, or the insurer may provide a cash settlement.
Do I Need Contents Insurance for a Mortgage?
Contents insurance isn’t normally a condition of getting a mortgage.
Buildings insurance is different. If you’re buying a property with a mortgage, your lender will normally require appropriate buildings insurance because the property is the security for the mortgage.
Your belongings aren’t part of that security, so the lender generally won’t require you to insure your sofa, television, clothing, computers or other possessions.
However, optional doesn’t necessarily mean unnecessary.
Someone who has just bought a home may have used a significant proportion of their savings for the deposit, legal fees, mortgage costs, moving expenses and furniture. Having to replace thousands of pounds worth of possessions shortly afterwards could therefore create considerable financial pressure.
This is why we believe buildings and contents insurance should be considered as part of the overall process of buying and protecting a home, rather than something to think about months after completion.
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We can help you consider your buildings and contents insurance alongside your mortgage.
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Do First-Time Buyers Need Contents Insurance?
Contents insurance isn’t normally compulsory for first-time buyers, but it’s worth considering when working out the full cost of owning your first home.
Buying a property can quickly use a significant amount of your available savings.
Alongside your deposit, you may need to budget for:
- solicitor and conveyancing fees;
- Stamp Duty, where applicable;
- mortgage and valuation fees;
- surveys;
- removals;
- furniture;
- appliances; and
- repairs or decorating.
That can leave less money available for unexpected costs immediately after moving.
Consider how much it would cost to replace your furniture, electronics, clothing and other belongings if they were seriously damaged by a fire, flood or escape of water shortly after you bought the property.
When we help first-time buyers arrange a mortgage, we therefore think it’s sensible to discuss buildings and contents insurance before completion rather than treating home insurance as an entirely separate decision later.
Do Renters Need Contents Insurance?
If you rent your home, you don’t normally need to arrange buildings insurance yourself. The landlord is generally responsible for insuring the structure of the property.
However, your landlord’s insurance won’t usually cover your own belongings.
If your furniture, television, laptop, clothing or other possessions were stolen or damaged by an event such as a fire or flood, you could be responsible for the cost of replacing them.
This is where contents-only insurance can help.
Contents insurance for renters can protect the belongings you own without covering the building itself. Depending on the policy, this can include items such as:
- furniture you own;
- televisions and other electronics;
- laptops and computers;
- clothing and shoes;
- jewellery and watches;
- kitchen equipment and other household belongings; and
- other personal possessions.
You may also be able to add optional cover for accidental damage or belongings you take outside the home, such as your phone, laptop, jewellery or watch.
What Doesn’t Contents Insurance Cover?
Contents insurance doesn’t cover every type of loss or damage.
Common exclusions or limitations can include:
- normal wear and tear;
- deliberate damage;
- damage caused by events excluded by the policy;
- belongings worth more than the policy’s individual item limit unless they have been declared;
- possessions taken outside the home unless personal possessions cover is included;
- certain losses when the property has been left unoccupied for an extended period; and
- claims where the policyholder hasn’t met relevant security or policy conditions.
Accidental damage also isn’t necessarily included as standard and may need to be added separately.
The exact exclusions vary between policies, so it’s important to read the policy wording rather than assuming every type of damage or loss is covered.
Does Contents Insurance Cover My Phone, Laptop and Belongings Outside the Home?
Not necessarily. A standard home contents UK policy primarily covers belongings at the insured property.
If you regularly take valuable possessions outside your home, such as:
- mobile phone
- laptop
- tablet
- jewellery
- watch
- camera
you may need personal possessions or away-from-home cover.
Some insurers offer this as an optional addition to contents insurance, and some cover may extend overseas. Check the geographical limits, individual item limits and exclusions carefully.
How Much Contents Insurance Do I Need?
The amount of contents insurance you need should broadly reflect how much it would cost to replace all of the belongings in your home if you lost everything.
A common mistake is to underestimate this figure.
Rather than thinking only about expensive items such as televisions, laptops and jewellery, go room by room and consider the combined replacement cost of your:
- furniture;
- clothing and shoes;
- electronics;
- kitchen equipment;
- appliances;
- carpets and soft furnishings;
- books;
- artwork;
- jewellery and watches;
- children’s belongings; and
- possessions stored in garages or outbuildings.
Individually, many of these items may not seem particularly valuable. Collectively, replacing an entire household can cost considerably more than expected.
You should also identify particularly valuable individual possessions.
Insurance policies can apply single-item limits, meaning an expensive watch, piece of jewellery, artwork or other valuable item may need to be specifically declared to ensure appropriate cover.
The aim isn’t to insure your possessions for what you originally paid for them. You need to consider what it would cost to replace them in accordance with the terms of the policy.
Do I Need to Declare Expensive Jewellery, Watches or Other Valuables?
Potentially. Contents insurance policies can apply limits to the amount they will pay for an individual item.
If you own an expensive watch, piece of jewellery, artwork, bicycle or other valuable possession, its replacement value could exceed the policy’s standard single-item limit.
In this situation, the item may need to be specifically declared to the insurer to ensure appropriate cover is in place.
Policies can also apply an overall limit to certain categories of valuables, so it’s important to consider both the value of individual possessions and their combined value.
If you regularly take valuable items outside your home, you should also check whether they are covered away from the property. Additional personal possessions cover may be required.
Depending on the insurer and value of the item, you may also need to provide information such as a receipt or professional valuation.
Always check the individual policy limits and requirements rather than assuming a valuable possession is automatically covered for its full replacement cost.
How Do I Choose Contents Insurance?
Choosing contents insurance isn’t simply about finding the cheapest policy. The cover needs to reflect the value of your belongings, the possessions you want to protect and the types of risks you want to insure against.
When comparing policies, consider the following:
1. Work Out How Much Your Belongings Are Worth
Estimate how much it would cost to replace the contents of your home if they were lost or destroyed.
Go through your home room by room and include furniture, clothing, electronics, appliances, jewellery and other personal possessions. The combined value can be considerably higher than expected.
2. Identify Any High-Value Items
Check whether you own individual items that could exceed the insurer’s single-item limit.
Expensive jewellery, watches, artwork, bicycles or electronics may need to be specifically declared on the policy to ensure they have appropriate cover.
3. Decide Whether You Need Accidental Damage Cover
Standard contents insurance doesn’t necessarily cover accidental damage.
Depending on the policy, additional accidental damage cover could protect you against incidents such as spilling a drink on a laptop or accidentally damaging furniture.
Consider whether this additional protection would be useful for your household and check exactly what the insurer includes.
4. Consider Cover Away From Your Home
If you regularly take valuable possessions outside your home, check whether the policy covers them.
You may need to add personal possessions cover for items such as your phone, laptop, watch, jewellery or other belongings when you’re away from home.
Check the geographical limits too, particularly if you want your possessions to be covered while travelling abroad.
5. Compare the Excess and Policy Limits
The excess is the amount you agree to contribute towards an eligible insurance claim.
A higher excess can sometimes reduce the cost of the policy, but it could also mean paying more yourself if you need to make a claim.
You should also check the overall contents limit, individual item limits and any specific limits that apply to categories of valuables.
6. Compare the Cover, Not Just the Price
The cheapest contents insurance policy isn’t necessarily the most suitable.
Two policies with similar premiums could provide different levels of cover, excesses, exclusions and limits.
There isn’t one “best contents insurance” policy for everybody. The appropriate policy is one that provides the protection you need at a cost you can afford.
Before taking out cover, check the policy documentation carefully so you understand what is and isn’t insured.
When Should I Arrange Buildings and Contents Insurance When Buying a Home?
If you’re buying a property, it’s worth thinking about home insurance before you collect the keys.
The timing is particularly important for buildings insurance. If you’re buying with a mortgage, your lender will normally require the property to have appropriate buildings insurance in place. Your solicitor or conveyancer can confirm when responsibility for insuring the property passes to you during the purchase.
You shouldn’t necessarily wait until completion day to start looking at your options.
When Should Buildings Insurance Start?
In many property purchases in England and Wales, the buyer becomes responsible for the property from exchange of contracts, rather than completion.
This means buildings insurance may need to start from exchange, even though you haven’t moved into the property yet.
However, the position can vary depending on the transaction, so you should follow the requirements of your solicitor, conveyancer and mortgage lender.
Buildings insurance protects the structure of the property against insured risks and is different from contents insurance, which protects your belongings.
When Should Contents Insurance Start?
Contents insurance is generally more relevant from the point your belongings are in the new property.
You can arrange the policy in advance and choose an appropriate start date so your possessions are protected when you move into your new home.
If you’re moving belongings between properties, check whether your policy provides any cover during the move and whether there are conditions or limits that apply.
Can I Arrange Buildings and Contents Insurance Together?
Yes. Homeowners can often arrange buildings and contents insurance under one combined policy rather than purchasing the two separately.
This can make managing your home insurance simpler, although you should still check that the buildings cover, contents limit, excesses and any additional protection are appropriate for your circumstances.
If you’re already arranging your mortgage through Oportfolio, we can discuss your buildings and contents insurance requirements as part of the same home-buying process.
Buying a property? Review My Home Insurance Options
Oportfolio Insight
When somebody buys a home, most of the financial attention naturally goes towards the mortgage.
But getting the mortgage is only one part of protecting the purchase.
Your mortgage lender is primarily concerned with the property securing its loan, which is why buildings insurance is generally important to the mortgage process. Your possessions are a different financial risk.
We regularly speak to buyers who have spent a substantial amount of their savings on the deposit, legal costs, moving expenses and furnishing their new home. At exactly that point, unexpectedly replacing tens of thousands of pounds worth of belongings could be particularly difficult.
That’s why we prefer to discuss home insurance as part of the overall buying process.
The question isn’t simply whether you can find the cheapest buildings and contents policy. It’s whether the amount insured, individual item limits, excesses and additional cover actually reflect your property and possessions.
Need Buildings and Contents Insurance for Your New Home?
If you’re buying a property, arranging suitable home insurance is another important part of protecting your purchase.
At Oportfolio Mortgages, we can help you consider your buildings and contents insurance alongside your mortgage.
We’ll look at your property, the approximate value of your belongings, any high-value items and the additional cover you may need before exploring suitable options through our panel of providers.
If you’re already arranging your mortgage through Oportfolio, we can discuss your insurance requirements as part of the same home-buying process.
