In Detail: When Did You Last Review Your Home Insurance Policy?

There is a particular kind of contentment that settles in around home insurance. The coming year’s premium arrives, it looks broadly reasonable, we renew, and we move on with our lives. At KGJ we understand the instinct entirely, but it’s important to consider your insurance policies as less a piece of paperwork and more as a protection for the life you’ve built – and it deserves rather more attention than most of us give it.

So, when did you last look, properly, at what your policy actually covers?

The figure that matters isn’t necessarily the one you think:

The single most common misunderstanding we encounter is the gap between market value and rebuild cost. Your buildings insurance was never designed to reflect what your home might fetch on the open market. It exists to cover the cost of reconstructing it from the ground up – materials, labour, professional fees, site clearances – and that figure can look very different from the number an estate agent would give you.

• Market value is shaped by location, desirability, and what a buyer is willing to pay.
• Rebuild cost is shaped by the property itself: its size, its construction, its age, its particular characters.

A beautiful period cottage in a sought-after village might carry a substantial market value but a comparatively modest rebuild cost. Equally, a more modest home with unusual construction or specialist features could cost considerably more to rebuild than its price tag suggests. Using the wrong figure is, quite simply, the easiest way to end up unintentionally underinsured.

Two products, often mistaken for one

We also tend to speak of “home insurance” as a single entity, when in truth it is two quite distinct forms of cover.

• Buildings insurance protects the physical structure – walls, roof, windows, fitted kitchens and bathrooms, and anything permanently attached to the property.
• Contents insurance protects everything you would take with you if you moved out, including furniture and soft furnishings, clothing, toys and technology.

Many insurers bundle the two together, but it’s worth knowing precisely which elements you hold – particularly if you let a property, own a leasehold flat, or live somewhere where buildings cover is arranged separately by a freeholder or management company.

Why the rebuild figure deserves a second look

Along with the cost of living, construction costs have moved considerably in recent years, which means a rebuild estimate that felt accurate at your last review may no longer reflect what it would cost to reconstruct your home today.

Many policies also include what’s known as an “average” clause. In practice, this means that if your property is insured for less than its true rebuild cost, a claim can be reduced in the same proportion. Insure a home worth £400,000 to rebuild for only £300,000, for instance, and you are covered for 75% of its true value – with a claim potentially reduced to match. It’s a detail worth getting right, and worth discussing with us.

If you’d like to review the cost of rebuilding your property, we’re able to arrange a professional rebuild cost assessment, This currently costs £195, and provides a considered, robust estimate of what reconstruction would genuinely cost. Alternatively, if you already work with a private surveyor who knows the property well, they may be able to provide this to you instead.

For homes that are older, listed, extended, or otherwise out of the ordinary, we’d always recommend a professional assessment over a standard calculation – it tends to capture the character an computer algorithm simply cannot. If you’re unsure which route suits your property, we’re happy to talk through the options with you.

Remember to revisit your rebuild value as circumstances change – perhaps you switch your conservatory to a warm-room, or you convert your garage. If you’ve extended your home, or if costs have simply moved on since you last checked, the number you’re relying on may no longer be quite right.

What’s inside deserves equal consideration

Getting the building value right is only half the story. It is remarkably easy to underestimate the collective value of everything contained inside a home – furniture, clothing, technology, kitchen equipment, the accumulated belongings of a family. It is also worth pausing to consider what it would actually cost to replace it all today, rather than what you paid for it originally.

Single-item limits

Most contents policies cap what they’ll pay for any single item unless it’s specifically named on the policy – typically somewhere in the region of £1,500 to £2,000, though this varies by insurer. It’s worth checking if you own jewellery, a watch, a musical instrument, or assessing the contents of your home office or gym; a handful of individual items can quickly exceed that limit even when your overall contents figure looks generous.

This small figure can have a large impact

Your excess is what you contribute before the insurer meets the cost of the remainer of the claim –  you may find separate, often higher, excesses apply to particular risks such as ‘escape of water’ or ‘subsidence’.

A higher excess can lower your annual premium and a lower excess means paying rather more upfront – but less if the worst happens. There’s no universally right answer here, only the one that suits you and your circumstances should you need to claim. What matters is knowing the number before you need it.

Don’t forget to check your policy’s small-print

The sums insured for buildings and contents tend to command the attention, yet it’s frequently the smaller sections of a policy that can prove incredibly useful in practice:

• Accidental damage – the spilt glass of wine or a damaged television screen are rarely covered under standard buildings or contents terms.
• Glass cover – this is worth checking in detail, particularly for conservatories or greenhouses, where terms vary considerably between insurers.
• Alternative accommodation – should your home become temporarily uninhabitable, this covers somewhere else to live while repairs proceed.
• Matching items – where available, this can mean the difference between a seamless repair and an obvious patch, such as replacing a work surface to preserve a uniform look.

None of this is about imagining the worst. It’s simply about making sure the cover you’re already paying for does what you believe it does. Your home, and everything within it, represents far more than bricks and possessions – and whilst it’s natural to focus on the premium when making your decision on which policy to proceed with, two seemingly similar policies can offer markedly different protection. As easy as it is to hop on the internet and take out the first home insurance policy you find, it’s important to know you are getting the cover you think you are and when you need to make a claim, a payout will be forthcoming.

Providing our clients with financial security and peace of mind are the aims of everything we do here at KGJ. When you need to protect the things that matter most, our bespoke home insurance brokerage services will ensure you a tailored solution that fits your exact needs, all backed up with advice and assistance throughout the length of the policy. If you’d like to talk through your own cover in detail – rebuild cost, contents value, item limits, excesses, the smaller sections that so often matter – we’d be glad to have that conversation with you. Insurance, after all, isn’t only about holding a policy. It’s about holding the right one, precisely when you need it.