What is a Building and Home Insurance Quote?
It sounds like a rhetorical question, but what exactly is a building and home insurance quote and how does it work? If you are shopping around for a quote for home insurance, companies that offer you cover will be subject to strict regulatory compliance designed to protect UK homeowners. As a home owner you will be affected by these procedures, processes and rules; which cover all aspects of insurance (from quote request, through to sale and annual policy renewal).
While the value of the average UK building and home insurance quote is just £170, the cost of repairing, replacing or rebuilding your home; could run into tens of thousands of pounds. So it is a false economy to focus just on the price, while glossing over the policy’s inherent value. Your building and home insurance policy provides a vital safety net if things go wrong. You must be confident your insurer will pay out should disaster ever occur. The regulatory environment in the Uk, means that insurers must be members of the Financial Services Compensation scheme. Gain confidence by carefully scrutinising the details within the quote itself and make sure it is suitable for your needs. Below we have outlined some of the practical aspects of obtaining and relying upon a building and home insurance quote..
If you go online to compare policies, the prices displayed are mainly indicative and cannot always be relied upon. Ordinarily you would click on one of the links presented, which would in turn take you to the home insurance companies’ own website. At this point you would be expected to confirm, adjust and finalise the details of your quote request. As the aggregators use a ‘one quote request form fits all’ approach, you may see slight differences in the assumptions displayed on aggregators’ website, when compared to the home insurance company’s’ website. Consequently you may have to confirm your final requirements related to excesses, cover levels or construction type. Any differences in assumptions can make a difference to your original indicative quote. For instance, insurers use varying assumptions with regard to how buildings are constructed. Some may assume your building does not have a flat roof. Others make prompt you to specify what percentage of roof is flat. Don’t assume the assumptions you originally specified will match up to the building insurer you finally choose to buy from. Any differences in the assumptions are likely to alter price.
When you speak to a representative of a broker or insurer over the telephone, you can be confident that any building quote provided is done so in a strictly controlled manner. The insurer is obliged by the FSA, to tell you (the potential policyholder) everything you need to know about the policy in question. In particular, they should be trained to point out the major ‘perils’ the policy is designed to protect against. Likewise they should mention if it excludes certain perils (such as flooding or subsidence). This is to help avoid policyholders accusing the insurer at a later date that they were not told everything they need to know, when they originally took out the policy. Many disputed claims surround ‘who said what to whom and when’, during the original quotation process. Likewise the same principle of ‘utmost good faith’ is applied to you as a potential policyholder. It is assumed that any information you provide is the truth and you provide the insurer with any information that is likely to affect their assessment of your risk
Whether you request a quote from a broker or insurance company direct; you will receive some important documents accompanying your quote. These include the Policy (and schedule of insurance), Keyfacts document and a Terms of Business or Customer Charter. This will confirm everything that has been agreed verbally over the phone or online. Your quote will show the annual premium, plus the insurance premium tax, plus any administration fee, plus any credit card charges (if applicable). Most quotes are usually valid for 30 days. During this time you will have a chance to study the policy documents, to make sure they meet your requirements.
As in all contracts, checking the small print associated with a quotation is vital. This will help to avoid future problems when making a home insurance claim. Once an insurance sale has been transacted and confirmed in writing, policyholders have a standard 14 day ‘cooling off period’, in which to change their minds. Now bear in mind the vast majority of claims occur after that calling off period has finished – Insurance disputes only really become apparent when an insurance claim is submitted, that is subsequently investigated or rejected. It is vital, then that you fully check all documents you are provided with, double check your answers as listed in the statement of fact and remember that any inaccuracies should be pointed out to the insurer immediately.
For instance, whereas a consumer can return and exchange a defective flat screen TV to a shop (six months after they bought it and under the manufacturer’s warranty) – a home insurance policyholder does not have the same luxury of time. If a policyholder claims they were not told something when they originally took out the policy, the insurance company will refer them to the ‘Statement of Fact’ or the ‘Proposal Form’ which they originally signed. The policy document provided to every policyholder, will also point out the terms and conditions of the contract. It is vital you check all documents at the point of sale carefully, to ensure that they really do reflect your actual needs and requirements. The sales logic is completely opposite of the principle of ‘buyer beware’ for products such as second-hand cars.
When you come to renew your building and home insurance policy, your provider will send out a reminder invitation. This should be issued, twenty one days prior to the renewal date. You may notice that your premium is more than last year, there may have been a general rate increase in the last twelve months or you may have made a claim and lost some of your no claims bonus. Industry factors can push up your renewal. Extreme weather caused by global warming, has recently resulted in increased volumes of claims for burst pipes and flood damage. So if your renewal price shows an increase, weather patterns may be the underlying cause. Many providers will offer incentives to keep hold of existing customers. In particular the largest building and home insurers may promote ‘special’ discounts for existing clients on other products such as travel or motor. if you have acquired more possessions in your home during the year, you should consider reviewing your contents levels accordingly. This may increase your renewal quote. Be aware that the insurer may also request you increase the security at your home, protecting your contents and valuables once certain sum insured thresholds are crossed.
Lastly it is worth mentioning that all the issues discussed above may differ, if your insurance company and your property (typically a holiday home or a second home) is based overseas. As a policyholder, any protection you receive many differ on a combination of factors linked to the location of the risk and the location of the issuing insurance company. You will most likely be protected by the Financial Services Authority unless both the risk and the insurer are overseas, you can always ask the issuing insurer as to their regulatory status. Different countries do have different approaches to the way that insurance is administered and regulated, in France for example, you must confirm in writing, your intention to cancel a building insurance policy – prior to the renewal date. Failure to do so would mean you are committed for another year. Whereas in the UK you can cancel your buildings insurance whenever you like. There are also many complicated local taxes in foreign countries. For these reasons, if you choose a UK insurance company you will at least have the reassurance that a tried and tested regulatory regime is there to protect you, throughout the quote, sale and renewal processes.
For a Home Insurance Quote contact Assetsure. We are able to offer insurance for a wide range of Uk property types including nonstandard construction