Insurance doesn’t cover all eventualities, there are many exclusions in the small print of insurance policies to look out for. The following examples identify some common ones in holiday home and second home policies that can ‘catch you out’.
It’s important that you familiarise yourself with any that apply to your policy, to ensure that it covers exactly what you expect it to.
Under insurance
Underestimating the value of your holiday home’s buildings and contents, whether unintentionally or deliberately to keep the premium down, can leave you under-insured and out of pocket in the event of a claim.
If your sums insured are inaccurate, any claim payments are likely to be reduced by the percentage that your property is underinsured by.
Your holiday home buildings sum insured should represent the amount that it would cost to rebuild your home, if for example it burnt to the ground. It’s important that you insure for the rebuild value, not the market value. The best way to get an accurate rebuild cost is to instruct a qualified surveyor.
This guide to calculating buildings rebuild value may be useful…
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