So if your home is of executive type or larger, where should you insure it and why?
The shorter answer is to the question “where”. If you go on Defaqto, the website that rates insurance policies, you will notice that there are a small number of policies that exist to insure the larger property. This is your niche market.
On Defacto they call this niche area “Premier Home Insurance”, aimed at the High Net Worth. At the time of writing the policies in this area total at just 34. And if you only want 4 or 5 star rated policies then this reduces further to 18, and all but two of them are only available through a broker or intermediary.
There is a simple reason why the broker network has a monopoly of these specialist polices; because they require a well seasoned professional to administer them correctly and ensure best advice is given to the client, as some cases can be quite complex when there are multiple properties or millions of pounds of fine art, or even a farm or an estate.
As to why use these policies, in my opinion the answer is simple. Why invest hundreds of thousands or even millions buying a large home and insure it with a policy designed to insure a two up two don’t. It just doesn’t make sense. That’s like buying a Ferrari and expecting it to perform as intended on apple juice.
But if you want some detailed reasons then read on to see just a few…
These policies are designed to insure larger homes where the cost of re-instating damaged property or contents is higher due to the size and quality.
There are many features within the policy that do not usually available in a standard home insurance.
For example a high value policy will not have any warranties and conditions that restrict the policy’s ability to settle a claim. Normal inner policy limits are increased to generous levels to accommodate the needs of the larger home.
These features can often mean the difference between a policy meeting a claim or not.
Fine Art and Jewellery cover
A high value home policy will provide relevant cover for fine art and jewellery items.
You can’t replace an item of fine art in the same way you replace a television. This is because antique items and precious metals and gems have a market value which fluctuates.
Fine art prices can change based on what’s currently desirable, rarity or perhaps the death of an artist.
Jewellery can change price depending on the price of gold, for example. In the past decade the price of gold has increased three to four times, dragging the price of expensive jewellery and watches up with it.
A specialist policy will pay a claim for these items based on market value, which should be taken from an up to date valuation. It is always advisable to have your valuations current and no older than 5 years.
Don’t think that a high value home insurance policy is expensive. The fact is a high value home insurance policy is often cheaper than a standard policy that is trying to insure a home beyond its capability.
Arranging a policy correctly can also save premium. For example fine art items have the lowest premium rating, so the more art you insure under that section the lower the premium (and the more relevant the cover).
On some policies jewellery insured in a home safe or bank vault is cheaper to insure over covering it world wide.
And lastly, you can make good premium saving by increasing your policy excess. If you would not make a small claim then why not increase your excess to save some premium? A £500 excess usually gives a good premium discount but is digestible in the event of a claim.
The insurers offering high value home insurance understand their clients and realise that a high level of service is a necessity. Insurers are quick to react to specialist requests and requirements and aim to be helpful and flexible.
Documents are clear and concise and issued quickly and efficiently. Renewals are sent to the broker for review in good time before the renewal date.
Some insurers offer a free appraisal service of every property and provide a report with a buildings re-instatement value, a contents review and security and fire prevention advice.
The reason we buy insurance is for peace of mind and it is important that we can rely on our insurers to perform when we need them the most. High value home insurers realise this more than anyone and have dedicated specialist claims handlers that each have autonomy to make decisions to settle claims.
Smaller claims can be settled and paid out within days (I have heard of cases settled within hours on the first phone call) and monies paid directly in to clients bank accounts.
Larger claims that need support from a loss adjuster are handled efficiently and the client and broker are kept informed throughout the process.
Many loss adjusters have authority from the insurer to settle claims during the visit and carry insurer cheque books. If a claim is really large, for example like the total destruction of a property caused by fire, then sometimes a project manager is appointed.
There is a story, which I heard first hand, of a leading insurer assisting a client with the loss of his late grandfathers Rolex watch, which had fallen off the client’s wrist in to a harbour.
The loss adjuster agreed to pay the claim for the expensive watch but noting that the client was upset also agreed to pay for a diver to go and look for it on the sea bed. The watch was found! The insurer then paid for the watch to be refurbished instead and the client was re-united with his cherished family heirloom.
A leading insurer concluded from a survey that 80% of owners of larger homes were under-insured.
From personal experience I would say that this is because many owners of prestige homes insure with the wrong type of insurer and therefore simple cannot get the cover.
Many people never realise the free advice and help that is available to them from insurance brokers. I for one will always discuss the amounts a client needs to insure for.
It is important to spend some time going from room to room totaling up all of your possessions. For contents these include carpets, soft furnishing and clothes. The cost of suits and shoes can often be surprisingly high!
Some insurers will provide a free home appraisal, as mentioned above. For more accurate valuation services brokers often have a number of Valuers they can put you on touch with who will value and provide an inventory of your fine art and general contents.
For insurance advice call Jeremy at Entrust Insurance Brokers on 0844 272 5358.
Visit us at http://www.entrust-
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Entrust Insurance Services are based in Fleet Hampshire and are professionally qualified Insurance Brokers.We believe in working closely with our clients for long term relationships that benefits both parties.We are friendly,approachable and professional.