Blog Homepage > The First Time Buyerâs Guide to Home Insurance
Buying your first house can seem like a challenge so large that it’s easy to consider sticking with renting for a couple more years. There’s an awful lot to think about: solicitors, home insurance, stamp duty, a hefty deposit…the list goes on! To help you demystify at least part of the process, today we’re taking a look at home insurance for the first time buyer!
You’ll need to choose what home insurance you need. Your mortgage provider will require you to have Mortgage Protection and Home Insurance, at an absolute minimum, so these two are a must. There’s also the option of Serious Illness Insurance, Contents Insurance, and Mortgage Repayment Protection Insurance.
Let’s take a look at each home insurance type and give you an insight into the purpose of each policy to help you choose the ones that are right for you!
1. Mortgage Protection
Mortgage protection clears your mortgage when you die. There’s no lump sum left behind, as with life insurance. If you get a mortgage, you’re legally obliged to buy mortgage protection.
A lot of people take out their cover through a bank or broker, but what they don’t realise is that most banks and brokers only deal with one insurance company which offers neither the best rates nor the best terms for them.
Mortgage protection bought from a bank is non-transferable. Usually, mortgage protection works on a decreasing term assurance basis, so it’ll reduce alongside your mortgage as you pay it off. There’s also the option of level term insurance and paying a consistent amount.
With a joint mortgage, you need to take out a policy to cover both you and your partner.
2. House Insurance
Realistically, your house is your most valuable asset. It makes sense to get house insurance in case something happens! Every policy is a little different but at Cornmarket, our house insurance policy includes:
Our HomeRescue Service is something we’re very proud of and covers:
Once the emergency repair has been made, the following additional benefits are also available if required:
For a detailed guide to house insurance, check out our post: Home Insurance - Get to know the basics. It’s a pretty handy post and should answer any questions you’ve got about our house insurance policies. If not, give us a call and we can answer any queries you have!
3. Serious Illness Cover
Serious Illness Cover lets you pay off your mortgage if you suffer from a specified illness covered by your policy. Usually, Serious Illness Cover can be built into your mortgage protection policy, though you can take it out as a separate policy.
Let’s use an example: let’s say you have a heart attack and you need to take a few months off work to recover. Serious Illness Cover will come into play and will pay towards your mortgage. For more information on Serious Illness Cover or to take a look at the Income Protection Plans we provide, click here.
4. Mortgage Repayment Protection Policy
This one is quite the mouthful! Mortgage Repayment Protection Policy ties in with Serious Illness Cover (and, in turn, with Income Protection). It covers your mortgage repayments if you’re not able to work because of a forced redundancy or illness for a set amount of time, or until you’re back in work.
5. Content Insurance
Content Insurance covers your stuff: your telly, your laptop, your fridge—all those things that make a house feel more like a home!
To get technical, contents are classed as household goods and personal effects. When you’re valuing your contents, don’t overvalue or undervalue them. Your best bet is to make up a list of everything you’d take with you if you were to move: that’s the stuff you need to get insured. For everything that’ll stay in your house and shed, contents insurance should keep you covered!
There you have it: everything you need to know about house insurance and the various policies available in one place!