Home Insurance Guide Blog

Bio diesel dangers

Wed, 27 Aug 2008 13:18:34 BST

Tales of holiday makers, who turn out not to be covered by their insurance for some of the more exotic activities that they embark upon whilst away, are relatively commonplace but what about risky activities in the home?

With everyone feeling the pinch these days, and the cost of fuel going up and up, some people have decided to take the matter into their own hands and make their own bio-diesel from cooking oil. It's not, as you may think, illegal. In fact you are permitted to make up to 2500 litres a year without tax consequences, so it can be a real temptation for some.

However, first things first. Before hitting the internet to find out how to start, you should check your home insurance policy. Finding out after an explosion that you have invalidated your policy could be a costly oversight. A man in Northants recently suffered 20% burns after his garage exploded whilst he was making his own bio-fuel from used cooking oil from his Chinese take-away. Having mixed together the oil, caustic soda and ethanol, a stray spark from an electric drill which he was using in the process was responsible in this case, but the risks are manifold.

Most policies include phrases such as "reasonable precautions" and "reasonable steps" which should be taken to prevent accident, injury, loss or damage and this could be called into question should the worst happen and your bio-diesel experiment goes horribly wrong.

The AA estimates that there are 20,000 people in the UK who make their own bio-diesel and the fire authorities in at least one region of the UK have issued warnings about the hazards inherent in the process for those with no knowledge of mixing chemicals.

Spare keys floating around could invalidate insurance

Thu, 14 Aug 2008 14:48:57 BST

It’s something that we have all done at some time or other: given a spare house key to a neighbour in case we lock ourselves out or perhaps to a cleaner or plumber to let themselves in when we are out at work.

However, how many of us keep track of just who has our house keys? It seems that forgetting to take them back is commonplace with an estimated one million or more of us not knowing who exactly has our spare keys.

Recent research by Sainsbury’s Home Insurance reveals that the average house has four sets of spare keys, although even this is open to debate since half a million of us have no idea how many spare sets exist for our property.

The most popular keepers of the spare keys seem to be children who now have their own home, with 27% of them still having keys to the family home. Parents or other family members living elsewhere come a close second at 25% and trusted neighbours come third at 11%.

Bottom of the league are estate agents, builders and window cleaners which is perhaps just as well since, should you be burgled and admit to your insurers that every Tom, Dick and Harry in the neighbourhood had access to your house keys, you may well find that your policy is invalidated.

If in doubt it is always safer to have your locks changed although this can be decidedly costly. It is obviously better to keep a close track of who has them and retrieve them as soon as practical.

Home buyers feel pressured to purchase insurance from lenders

Fri, 08 Aug 2008 13:40:59 BST

According to a new study carried out by Gocompare.com, one fifth of homeowners purchase their home insurance from the same company that provided them with their mortgage. This has led to concerns that customers are being pressured by their banks into purchasing insurance from them rather than looking around for a better deal.

The results reveal that whereas 19% of those who purchased their insurance policy from their mortgage lenders did so for quality and value, 12% stated that they felt pressured by the company into making the purchase. A further one third of customers who bought insurance from their mortgage lenders revealed that they did so simply because it was more convenient to take it out with the same company.

Hayley Parsons, chief executive of Gocompare.com, expressed concern at the findings, stating that it was a “worrying sign” of the trends occurring in the present economic climate. Talking in relation to the small margins being made on mortgages, she said that “there can be a danger of pressure selling” on the part of the lenders in order to increase profits, a practice that is not in the best interests of the customer.

Even if the insurance represents a good deal, there should never be any pressure to purchase it from the mortgage lenders. Also, seeing as mortgage lenders only provide insurance from one company, it is not likely to be the most competitive price on the market. The advice to customers is to shop around to find the best deal available, as taking the time to compare prices can lead to large savings without forfeiting on quality.

New overseas home insurance launched

Wed, 30 Jul 2008 14:11:53 BST

If you have ever thought about buying a holiday home in the sun, taking cheap holidays abroad every year and enjoying everything that goes with it, you may have been put off in the past by the legal complications involved in finding insurance in a different country.

You will therefore be pleased to know that Confused.com has recently launched a new service offering to take all the hassle out of getting insurance for your home away from home.

The new service, which is being arranged through Hiscox insurance, aims to save the customer all of the usual hassle that goes with insuring a property. People are often left confused and daunted by foreign legal systems, which often operate very differently to our own. Numerous rules are changed slightly, sometimes quite drastically, and getting a handle on them can be a nightmare.

The new service aims to cut out all of these issues and more by presenting an insurance package in exactly the same way as one from the UK would be purchased. Everything comes in English, the laws are all clear to understand and there are no foreign insurance brokers to deal with.

Carlton Hood, chief executive officer of Confused.com, said that people can now get home insurance “without the worry of language barriers or alien property laws”.

As the only service of its kind, it is expected to be very popular with UK property buyers and could lead the way for a whole host of such services springing up in the future.

Check your insurance before the school holidays!

Wed, 23 Jul 2008 15:31:22 BST

In the light of research from insurance company, Sheila’s Wheels, parents would be well advised to check their home insurance, with the start of the school holidays upon us.

Their figures show that one in four children under the age of 16 has caused damage to, or broken, a piece of expensive electrical equipment at an average rate of £183 per child per year. Nationwide the total bill for repairs or replacement comes to a staggering £553 million a year.

The top five gadgets to be affected are DVD players (43%), games consoles such as the Wii, PS3 and X Box 360 (39%), TVs (34%), stereos (33%) and laptops (31%).

Accidental damage cover on the home contents policy can be worth its weight in gold but is often seen as a luxury which people cannot afford to pay for. This is perhaps the reason why 25% of families have had accidental damage caused by their offspring but only 20% have claimed on their insurance policy. There are also a surprising 17% of parents who have no home contents insurance whatsoever.

According to a spokesperson from Sheila’s Wheels, boredom is a prime contributory factor for damage during the school holidays: kids cooped up indoors during the great British summer have the capacity to inflict untold damage on delicate pieces of equipment. Then of course there is carelessness, with spilt drinks on computers being a perennial problem.

Scottish children come out worst in the statistics, causing a third more damage (£243 per year) than the UK as a whole, whilst children in the Midlands are much less likely to be caught behaving badly and cause a mere £105 on average each year.

Comparison sites - are they worth using?

Wed, 16 Jul 2008 19:25:25 BST

You may well have wondered whether home insurance price comparison sites are all they’re cracked up to be. It seems, however, that they are inferior to comparable sites for motor insurance, according to a recent report by Defaqto, the independent provider of research into financial services. Their sixth annual report, “Home Insurance – Aggregation or aggravation” looked at 28 comparison sites and concluded that, in the home insurance market, it is definitely a case of “Buyer beware!”

Defaqto looked in depth at the service provided by the various sites, which included the big names, Comparethemarket, Confused.com, Gocompare, Tesco Compare, and Moneysupermarket. The report uncovered various pitfalls for those using the aggregators.

Firstly, no single comparison site covers the entire market, despite what you may think from reading the websites. Secondly, the large majority of sites are only capable of comparing prices rather than the small print. Thirdly, the comparisons are only as good as the assumptions made, when obtaining the quotes from insurance companies or brokers. They may not fit the bill precisely for you and it is therefore crucial for customers to check the quote carefully, in particular the level of excess on the policy. Fourthly, Defaqto concludes that many of the sites do not allow the customer to tailor the quote to their needs, for example obtaining cover for possessions taken out of the home such as cameras, watches and the like. If you do not take the time to check the small print, you could well find yourself out of pocket should a loss occur.

Mike Powell, a consultant at Defaqto, goes as far as saying that this could well be considered “poor practice” by the FSA. In his opinion there are only five true comparison sites, with the balance obtaining quotes through intermediaries which could be done easily by the client through a broker.