Home insurance has become increasingly sophisticated. Previously there was very much a “one size fits all” style by insurers resulting in policyholders buying a standard buildings and/or contents insurance policy that had no relevance to their particular circumstances. As a result of this a lot of policyholders were giving money for an insurance premium with aspects of cover that were actually not appropriate to them and that they could never claim against.

Insurers have gradually understood that policyholders need more tailored cover that echoes their individual situations and the many different ways in which we live in property today. Though standard home buildings and contents insurance policies go on to dominating the markets for standard home owners who live in their own homes, other policies have become obtainable to meet these altering requests. Landlord insurance, developed to meet the needs of professional and buy-to-let landlords, has seen an increase. More recently, tenants insurance has made it’s way to the foreground.

Tenants insurance was previously a bit of a niche market, not considered particularly glamorous and targeted mainly at students leaving the parental home and moving into rented accommodation for the first time. Recent weather events in the UK such as the extreme flooding that parts of the country have experienced, however, have highlighted the generally low take up for home contents insurance, particularly amongst those who do not own their own home.

These issues have steered an increasing interest in tenants’ insurance policies by the insurance market and prospective policyholders alike generating the relaunch of current products as well as the expansion with new products. So, what does it cover and who is tenants insurance designed for?

Tenants insurance is designed for those who do not need to insure the building they live in but who do wish to insure their possessions. This includes those who rent either self contained or shared properties or those who are leaseholders and where the freeholder is responsible for insuring the building. Some insurers offer specialist policies specifically for students. Tenants insurance provides cover for a policyholder’s possessions, that is, those things that the policyholder can take with them when they move. This includes items such as clothes, laptops, CDs, curtains, white goods and valuable items, such as jewellery.

In its simplest form, a tenant’s insurance policy usually provides cover for loss or damage instigated by flood, fire or theft from the home location. There are numerous extensions to cover available, however. Ranging from extending the dangers insured against to also include storm damage, escape of water or unintentional damage, or encompassing the range of items insured, for example, frozen food following trouble with the energy suppliers. Policies can also be tailored to cover specified possessions whilst away from the home. Furthermore, many insurers offer “add ons” to the policy, for example legal expenses cover.

Of course, there are also a number of eliminations under a tenants insurance policy, a lot of which are typical across the trade, for example losses arising after the property has been vacant for more than thirty days. Exclusions differ depending on insurer, such as the condition for there to be forced entry for a theft claim to be covered. There is an on-going requirement to advise the insurer of any material fact, as with any insurer. This simple principle of insurance means that the policyholder is required to tell the insurer of anything that would affect the insurer in determining whether to give cover or defining what fee to charge for a policy.

There are variations to the way insurers charge for a policy too. Some charge according to the number of bedrooms, this is known as a bedroom-rated policy. Other insurers charge based on the total value of the contents being covered, this is known as a sum insured policy. Whichever you choose, policies usually contain a clause restraining the insurer to a maximum limit amount that it will pay out per item. Separate items exceeding this amount need to be explicitly mentioned to the insurer and marked on the policy.

The basis of settlement can also vary between insurance policies. Some insurers provide cover on an indemnity basis only, meaning that a policyholder is only entitled to be put back in the same position as before the loss. This means that a deduction is made for wear and tear on the damaged or lost items that reflects their age. The alternative basis of cover is new for old whereby the policyholder can claim the full cost of replacement of a comparable item.

Overall, the cover available, the policy exclusions and the basis of settlement under a tenants insurance policy is not that different from any other home insurance policy. As such policies have been written specifically with tenants in mind, however, the terms and conditions of the policy are relevant and can be complied with. Conditions that are the responsibility of a home owner or landlord have been stripped out of such policies. Likewise, a premium is not charged for cover that a tenant can never access.

Money Supermarket is a great place to get quotes on the cheapest home insurance, and students contents insurance.