The Home Insurance Policy Explained

The house insurance product has two variations and the price paid varies according to the options chosen.

The products can be split into standard cover and accidental damage (or all risks). If you purchase standard cover, you need to compare any loss you have with the list of 'peril's against which you are insured. If you can't match your particular claim to one of the listed risks, you are not covered. The 'onus of proof' is on your shoulders. In other words it is you that has to provide proof to the insurance company that the cause of loss is covered.

If you purchased accidental damage cover, you effectively have an 'all risks' type of cover. With this type of policy you are covered for any and every possible type of loss, apart from those listed in the exclusions (small print). With this type of product The 'onus of proof' rests with your insurer. That means that it is up to them to prove that you are not covered against that risk.

Standard Cover
You should have a list of risks covered plus another list of variations that apply only to that peril. A typical policy might look something like this:
- Earthquake, Smoke, Lightning, Explosion, Fire - excluding damage caused gradually
- Aircraft and articles or parts falling from them
- Impact by animals, vehicles or falling trees or branches - apart from damage caused by lopping or felling trees
- Theft or attempted theft - apart from losses that occur if the property left empty for over thirty days or left unfurnished or caused by a tenant or lodger or paying guest.
- Malicious Persons - identical exclusions as for theft
- Burst Pipes - some exclude frozen pipes, others include it
- Flood or Storm - excludes damage by frost and damage by storm to fences, gates and hedges
- Political Disturbances, Civil Commotion, Strikes, Riot or Labour Disturbances
- Leakage of Oil
- Radio receiving aerials, Television Aerials, Satellite dishes, Mast breakage or collapse
- Subsidence - A very tricky subject that requires a complete article all to itself

We will run through each of these in greater detail.

FIRE - Provided that there are actual flames then there should be no problem. Smoke damage caused by the fire is also covered. You cannot claim for the discolouration to your decorations caused by the continual smoking of cigarettes and so on. That is not an accident, it is something that you chose to do. Hence the exclusion. There are further exceptions to the rule that there has to be flames but they differ substantially from one insurer to the next, so you ought to check them carefully in your policy.

LIGHTNING STRIKES - you are fully covered against any damage to your building caused by a lightning strike. If lightning strikes your aerial, sorry but that is a contents claim! Even though aerials are listed as an insured peril, they are not part of the definition of a building. They do appear in contents. So damage to aerials necessitates a contents claim. Similarly with earthquakes and explosions. Fortunately these are few and far between here in Britain.

AIRCRAFT - This covers anything dropped from just about anything that flies. Again, luckily for us, a rare occurrence.

IMPACT - The idea is that if your house is hit by a vehicle or a wild animal, you are protected. Concerning trees, if you have hired a tree surgeon to fell or manicure a tree, you must ensure that all precautions are taken to stop it falling onto your house (or sheds. garage etc). Whenever you have an outside contractor doing this work, and their actions damage your property, then you are entitled to seek recompense for the damage from them. However your home insurance policy will still exclude this damage so you cannot claim from your insurer.

THEFT - Cover is very wide, that is the exclusions do not greatly limit the cover provided. Whenever your house is left empty for a long time (e.g. over thirty days), then cover is restricted as the property is recognised as a juicier target for burglars. Indeed, if your house is left unfurnished or unoccupied you should tell your insurer anyway! Similarly with a tenant or lodger. The likelihood of the tenant or lodger being involved in the crime is such that your insurer does not want to insure against that particular risk, hence the exclusion. Once again, if you are doing this, you should tell your insurer.

MALICIOUS PERSONS - This is much the same as the exclusions relating to theft.

BURST PIPES - Insurers position on this has improved in the last few years. A good company will cover any leak, from any pipe, tank or water apparatus, even if it has leaked over a lengthy period. Some insurance companies will also now include damage caused by the defrosting of frozen pipes. When I first started working in this industry, it was strictly the case that the burst pipe was not covered, only the resulting water damage. Where there is clear evidence that the pipe has failed due to rust then your insurer might still raise this argument. If a nail makes a hole in a pipe, for example whilst fitting a carpet, then you will need accidental damage cover for the pipe repair but the resultant water damage to your building is covered under this peril.

STORM OR FLOOD - The definition of a storm varies from one insurance company to the next - check the policy wording. Frost damage is excluded although snow damage is covered. A frequent disappointment is that damage caused to fences, gates and hedges is not covered. Some fences seem to blow over with the lightest puff of wind! There is at least one insurer offering additional cover, at a premium, for storm damage to these items.

RIOT, CIVIL COMMOTION etc. - Again, it is rare for such activities to damage to your property, but should it happen, you are covered. In certain circumstances, your insurance company will have a right to recover their costs from the police force.

LEAKAGE OF OIL - For those with oil fired central heating, any damage to your buildings caused by the oil leaking is covered.

TELEVISION, SATELLITE AERIALS - As indicated above, your buildings are protected if any receiving aerial collapses and causes damage. But the aerials, dishes etc themselves are defined as contents and therefore they are not included in your house insurance policy.