Ambareen Musa, founder of Souqalmal.com
Home insurance coverage can extend to buildings, contents or personal belongings. Your choice of home insurance may vary depending on whether you own the house or have rented it out. As a tenant, you will be interested in contents cover which will protect the existing contents of your house such as furniture and other household goods. According to a YouGov survey, only 6 per cent of UAE residents have contents insurance. They don’t feel the UAE is exposed to risks such as fire, theft, earthquakes, floods or other natural catastrophes.
The contents of your home may be more valuable than you think. There are different types of home content insurance policies and it is best to compare the details of each to understand how much of your property and valuables will be covered in unavoidable circumstances. When shopping for the right policy, make sure you look for:
• Loss of rent or alternate accommodation: you could lose a substantial amount of money if your house is being repaired following a fire or flood. While most policies automatically cover this, others may charge a higher premium to add this feature.
• Tenants liability: a major concern for tenants is the security of the landlord’s premises. This cover protects you against any legal responsibility for loss or damage to the landlord’s fixtures and fittings. While most tenant policies include this cover, double check before you sign.
• Replacement as new: under this feature, you are covered on a “repair or replacement as new” basis. This means that your damaged home contents will be either repaired or replaced. This holds true for most content policies, except for items such as clothing and household linen.
• Contents in the open: while you may have protected the items inside your house, don’t forget those outside too – your cover can extend to loss or damage to any contents left in the open but within the boundaries of your property.
Other add-ons to consider for additional protection include personal belongings cover of valuables, phones, portable equipment, money, credit cards, etc along with accidental damage, cover for domestic help and garden cover.
The reader’s advice
Kieran Blythe, Dubai
I have lived in the UAE for 12 years and never bothered with home contents insurance until bicycles, pot plants and children’s scooters starting disappearing from outside homes in the community I live in. But because crime is on the low side, I chose a basic policy that insures Dh75,000 of the contents in my home. This was an offer from my car insurer and it only costs me Dh200 a year. It provides protection against fire, theft and natural calamities, but the payout is capped at that Dh75,000 mark. This gives me peace of mind for when I travel overseas but, at the same time, I do not feel I am overpaying for something I’m unlikely to ever claim on. Interestingly, though, in the process of signing up for the policy, I discovered it covered things such as my wallet, if I mislaid it outside the home, the contents of my freezer and even new locks if I lost the house key and needed to replace the locks.
Next Money Clinic:
I am due to retire in five years’ time and my portfolio is currently heavily invested in stocks and bonds. When should I de-risk my portfolio to ensure I do not lose out when I retire? KL, Abu Dhabi
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