Home Insurance & Terrorism Charges
Filed under: Car Insurance News
Have you ever wondered how home insurance premiums are calculated? A lot of people do but very few actually find out the answer. Well, I’m about to let you in on a little secret. Although I cannot tell you exactly how premiums are calculated because the insurers rarely reveal such secrets, I can tell you some of the factors that make a difference. For example, there are reasons why your premiums will be lower if you live outside the city or town. Rural dwellers are perceived as having distinct advantages over urban dwellers when it comes to home insurance premiums and this is no new thing. In fact, it is pretty old. This relates directly to crime rates, which are notably higher in towns and cities, as well as the enhanced value of properties. However, all homeowners will have found that their premiums for home insurance have gone up recently regardless of where they live. This is thanks to the surcharge many insurers are adding onto the total to cover… (drumroll please)… terrorism!
Yes, you read that correctly. Many homeowners’ buildings insurance now incorporates a surcharge that is designed to cover any act of terrorism. As many people have claimed as a result of it since 2005, terrorism is becoming a major part of life, no matter how much we wish the opposite were true. Of course, any incidence of it is very rare but that has not stopped insurers making provisions just in case.
The average charge added to home insurance premiums has been determined at in excess of £60, which may not sound like a lot when it is broken down into £5 a month and this is often how it is packaged, but it soon adds up. It is not optional in many cases either but has simply been added because insurers have been compelled to pay out in the event of terrorism despite the fact that their terms and conditions often state that they will not pay out for that very reason.
Although some providers do offer such cover as optional, thus giving you the chance to decide whether or not you want to have that protection, many just added the premium on to that you would normally pay without telling you. Yes, we are all worried about terrorism but we should know exactly what our home insurance covers us for rather than just covering the cost and having no idea what we are paying for.
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Posted on July 18th, 2011 by Elizabeth Martin
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