Which is right for you - standalone insurance for your valuable items or a full home contents policy?
In the past, you probably wouldn’t consider buying home contents insurance as a young renter who owns just a few things. It would only be on your radar when you bought your first home and started to fill it with shiny new appliances and furniture. That’s changing fast, with younger people now starting to think about contents insurance sooner than they previously would.
There are two reasons for this according to Ernest North, co-founder at AI-driven car, home and contents insurance provider, Naked. The first is the fact that many young people own expensive items they simply cannot live without: for example, a mountain bike they use for leisure and training/exercise, or a smartphone and MacBook they depend on to earn a freelance or side hustle income.
The second reason is the arrival of affordable and easy-to-buy insurance products designed for standalone items. “It used to be impossible or extremely costly to insure most personal items on a standalone basis. Now anyone can get a quote and buy cover for a single item online within seconds. This has made insurance accessible to a wider market,” says North.
Yet, most people thinking of insuring one or two items should get quotes for full home cover and for standalone insurance for their possessions to see what suits their needs best.
The benefits of buying home contents insurance and adding portables to this policy can be summed up as follows:
The cost of insuring multiple items will generally be lower in a home contents policy than it would when buying separate standalone cover for each. It makes sense to get full home cover if you’re looking to insure more than one or two items, and then to add your portable possessions to the policy.
A home contents policy can cover the cost of items that are often forgotten, such as clothing, small appliances, and kitchen utensils – one only appreciates how expensive these are if it becomes necessary to replace them all at once after a robbery or fire.
Home contents policies usually include personal liability cover. Personal liability is when you are held legally responsible for causing bodily injury to someone else or damage to their property. Personal liability cover protects you financially and legally if a lawsuit or claim is brought against you.
Home insurance cover includes benefits like emergency home assistance—for example, a plumber if your geyser bursts or an emergency security guard while your gates are being fixed after a break-in.
You will pay only one excess per claim, even if many of your things are stolen or broken in one incident. If your bike and smartphone are insured on standalone policies and both are stolen, you’ll pay an excess for each.
Advantages of standalone insurance are:
It’s quick and easy (under 30 seconds*) to get a binding quote online. You can buy it within minutes if you’re happy with the quote.
Getting standalone insurance is more transparent and often cheaper than buying it along with a product purchase from the retailer, for example, insurance along with your new cellphone contract.
You can adjust the excess per item to suit your needs (see fig. 2). On items where you think the risk is very low, choosing a high excess means you pay a low premium.
There is no minimum premium for insuring an item. For example, digital insurance providers with low overheads can sell a policy for R28 a month for a surfboard, whereas traditional insurers need to charge around R200 a month on a policy to cover the costs of their infrastructure.