Home Insurance Jargon Buster

• Accidental Damage

  A type of insurance that provides broad coverage for a range of situations where the building or your contents are damaged by accident. This could include spilling paint on a carpet, a TV screen smashing or a roof caving in when someone is walking on it. General wear and tear does not constitute accidental damage and is therefore not covered.

• Act of God

  Some insurance policies cover for major events like earthquakes, floods, lightning strikes etc. These are deemed to be “Acts of God” and are not covered in all insurance polcies. Check your small print.

• Buildings Cover

  This type of insurance policy covers your home – the actual building itself. Coverage includes damage to roofs, walls, windows, doors, bathroom suites,fitted kitchens and every other fixed feature. It does not cover personal belongings or anything that can be picked up and removed from the building.

• Building Replacement Value

  How much is your building worth and what would it cost to rebuild it if it were to be completely destroyed. This is your Building Replacement Value.

• Certificate of Insurance

  This piece of paper is issued by your insurance company and proves you have valid insurance cover for a 12 month period of time. You will need this document if you are involved in an accident or when you are taxing your car.

• Contents Insurance

  This type of insurance policy covers your personal belongings including electronics, jewellery, gadgets, bikes etc. Contents insurance is often bundles with Building Insurance for home owners.

• Excess

  Excess is the amount of money you are required to pay for a claim with the balance being paid by the insurer. Most insurance policies have some sort of compulsory excess to discourage small claims from consumers.

• Exclusions

  This is a vital part of your home insurance policy to understand. Exclusions are a list of situations when your insurance policy will be deemed null and void. For example, you have left your home vacant for more than 30 days.

• Maximum Contents Cover

  This defines the total amount you can claim for the contents of your home if destroyed or lost due to theft. Higher amounts can be requested from your insurer but expect premiums to increase.

• No Claims Discount

  If you don’t make a claim on your insurance policy you are entitled to a discount on the next year’s cost. Over a number of years this discount builds up allowing you to enjoy cheaper premiums. It is a bonus designed to encourage and reward those who do not make regular claims.

• Premium

  This is the cost of the insurance policy and is usually paid 12 months in advance or on a monthly basis. Annual premiums usually work out cheaper than monthly premiums.

• Single Item Limit

  This is the maximum value that can be claimed against an individual item e.g. a piece of jewellery. You can request for a higher sum to be assigned to particularly valuable pieces of jewellery or art but expect your premiums to increase as a result.