Hidden no-claims discounts, an increasing tendency to dispute claims and higher excesses are just some of the tactics used by insurers that homeowners need to be aware of when buying home insurance. Yet, without insurance most people would be financially devastated if their homes suffered the extent of the flood damage some UK properties have experienced recently.
The bad weather has put home insurance in the news as a result of the Government's unwillingness to reach an agreement with the insurance industry over how owners of properties at high risk of flooding can be provided with affordable cover in future.
Kevin Pratt, insurance expert at MoneySupermarket, says: "If you have to claim on your insurance (for flood damage), you will see a hike in your premium when your insurance comes up for renewal. How much that hike will be depends on the severity of damage and the cost of the claim."
However, if there is no agreement with the Government, Mr Pratt adds: "Potentially thousands of people could find themselves uninsurable – for flooding cover at least."
It can already be difficult for some people in higher risk areas to obtain or switch their home insurance cover. Comparison sites do not normally cater for anything out of the ordinary. Quotations are based on postcodes, which means you may either be refused cover or offered punitive terms. Going to an insurance broker in this situation can help as they can take a property's individual circumstances into account.
Dawn Harley, regional sales director at broking firm, Towergate Insurance in Glasgow, explains: "We can have open conversations with householders and can influence underwriters' decisions."
She points out that brokers can also help fight your corner if you need to make a claim.
Flood claims can be for significant amounts, not just for the damage itself but also for the cost of things such as alternative accommodation while your home is being reinstated. Insurers have recently been advising on how to minimise claims if a flood is imminent by, for example, taking electrical items and valuables upstairs. But if you make any claim on your home insurance policy you need to consider the consequences.
Brian Brown, head of consulting at financial researchers Defaqto, says: "A lot of insurers have some form of hidden no-claims discount which means that if you claim one year your premiums could go up significantly the following year. But you won't find any reference to it in the policy document."
Wear and tear is not covered and if you make a weather related claim where part of the damage could be attributed to poor maintenance, an insurer may require you to make at least a contribution to the cost.
"Insurers are getting tougher on wear and tear," says Mr Brown. "This is why they refer not simply to storm damage but to specific wind speeds. When they are looking at damage to a roof, they may also consider the age of the roof. If it is, say, 50 years old they may argue the toss."
Two years ago, when there was a prolonged period of heavy snow, insurers suffered a spate of claims from Scottish policyholders relating to roofs damaged by weight of snow. But in fact, Mr Brown says, weight of snow is not an insured risk. He says: "Storms are covered but they are normally sudden events, a gradual build up of snow is not. Where possible insurers will expect you to brush away snow if you can."
In the case of flooding, it is not just damage from external water that is causing insurers problems. Internal water leakage is becoming an increasingly big issue as more homeowners install ensuite facilities. Mr Brown says: "The excess for water leakage is often £250 nowadays and some insurers are excluding damage due to failure of mastic or grout around baths and showers. Some are even excluding leaving plugs in baths under their accidental damage cover."
On a more positive note, don't forget to check if your home insurance policy offers emergency home assistance cover in case you suffer problems this winter. Many policies offer this service as an optional extra or even part of the standard cover and may even cover the cost of an emergency plumber if you need to call them out to mend burst pipes or something similar.