The challenge of insuring hard-to-insure homes

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Many of us probably don’t give home insurance a second thought past the process of annual renewal, but for some people, it’s not so straightforward.

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Those with unusual homes or possessions may be familiar with this issue when it comes to securing home insurance. Some homes are hard to insure, and can cause a headache when trying to find the best home insurance policy. We asked Export & General insurance experts about some of their toughest insurance gigs.

There are a variety of reasons insurance companies are less than keen to insure certain homes, from the foundations of the house to the contents inside. Premiums can be really high, and sometimes it can even prove impossible to get insurance at all.

What makes a home hard to insure?

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Location

A house near a flood area or built upon tree roots will create a lot of difficulty when it comes to insurance. A property more liable to flooding or other damage caused by nature will be higher up on insurance expenses.

The building is unoccupied

If the property is currently awaiting new tenants or undergoing renovations, simple home insurance won’t cover it. Look into your options before leaving your property unattended.

Other issues include aspects like thatched roofs, non-typical construction issues, high net worth contents and so on. We talked to Export & General, the home insurance specialists, about how to work around some of these issues…

Example #1: Avoiding a flat spin

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The property:
A ground floor garden flat within a two-storey house that has been converted into two flats. The two flats have separate owners.

The problem:
Given the nature of the building, the owners did not want to pay for two separate policies, one for building insurance and one for the ground floor flat.

The owners rent out the ground floor flat, while the upstairs flat is owner-occupied. There was no problem with obtaining contents insurance, but building insurance for the overall property was more complicated. The two flats share a front door, but have different types of occupiers.

Comparison sites were not helpful, so the ground floor flat owners simply stayed with their existing provider for years.

E&G’s solution:
E&G scoured a series of providers and found a policy that offered significant savings compared to renewing with their long-standing insurer. As well as offering the same level of cover as the old policy, the new policy provided legal cover for both properties within the new, lower price.

Example #2: The art of the deal

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The properties:
Two houses – a six-bedroom house in an affluent area of London and one by the coast. The coastal property, a four-bedroom home, is used by the owners as a holiday home and they let it on sites such as Airbnb. A large art collection is shared between both properties.

The problem:
Premiums kept rising on the two houses and the client was not happy with the service from their existing insurer. The client felt the insurer did not understand their unique requirements, especially the need for a policy that allowed them to move their art collection between the two properties.

E&G’s solution:
We work with a number of insurers that specialise in mid- and high-net worth homes. They understand the need to be flexible with the higher value items that often need to be insured in these properties. E&G worked with Connoisseur Underwriting, an insurer that specialises in large art collections kept in homes, to provide two bespoke policies.

One policy covered building and contents insurance for both homes, while the other covered the art collection, allowing the pieces to be moved freely between London and the coast for a single price. E&G were able to arrange these two policies at a lower premium than the client had paid in the previous year.

Example #3: Thatching a plan

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The property:
A thatched four-bedroom cottage with a gas fireplace. The owners, who divide their time between Spain and the UK, bought the cottage to live in when they’re in the UK and rent it as a holiday let when they’re abroad.

The problem:
The gas fireplace is vented through the side of the property rather than the roof. In addition, there is a sunken LPG tank within 10m of the property and CCTV for security.  Insurance companies constantly raised safety concerns about the lack of spark arresters. Even though they aren’t required because of the side vent.

E&G’s solution:
We work with specialist thatch underwriters and liaise with our clients to understand their specific property and it’s risks. In some cases certain additional precautions need to be taken including installing fire extinguishers and blankets, and smoke alarms on every floor including any roof space. As the occupants share their time between the UK and Spain a fire alarm with fire brigade response could be beneficial. Our insurers also provide cover for properties used as holiday lets part time, so we had no problem finding a great deal.

Challenge time!

Have you got unusual contents? Is your property a hard to insure home?! Maybe you’re paying way too much for your property, or maybe you’ve done some renovations? Worth a check? E&G accept the challenge – see what they can do for you.

Click here to visit Export & General for more information.

 

 

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