Home Insurance: advantages and disadvantages!

Home insurance is designed to protect you and your family in the case of unexpected events such as fire, theft, flooding etc.As with any financial contract which you may enter into, home insurance contracts have their advantages and disadvantages. The main advantage of home insurance is that it provides security and most importantly peace of mind, so that you know that if something unfortunate and unexpected happens, you will be able to cope.

Home Insurance also means that if such an event occurs, it is less stressful and psychologically damaging, as the insurance company is there to take care of certain things for you.

There are many features (often not covered under standard policies) of home insurance which can be seen as advantages. For example, some contracts specify that if an item usually belongs in the home, it is covered even outside the country. This means that for example, your digital camera may be covered under your home insurance while you are on holiday! Also, most insurance companies will replace your old furniture/appliances with new equivalents, so in the case of a claim, you get brand new replacement products!

Unfortunately, home insurance can have disadvantages too. The most obvious one is that you may shell out home insurance premiums each year and yet never make a claim – effectively you are merely paying money for peace of mind and never receiving anything in return. Also, insurance companies are notorious for not paying up if they can get away with it! They are usually perfectly within their rights to do so. You are well advised to check the small print!