What is Contents Insurance?

From theft to personal liability, get to grips with your policy.

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If only there was a way to turn back time on that big night out last month… yeah, you know the one. It started out with friends over for drinks, and then your best mate tripped and left massive wine splotches on your landlord’s couch. After that it was off to the club, where your newly-minted mobile phone and credit card got nicked out of your bag. You’re home at 4AM to find a burst pipe from the washing machine has flooded the flat. So yeah…that night.

If you had the right kind of contents insurance, with enough cover, you’d be sweating a lot less in this nightmare scenario. That’s because contents insurance would have paid to replace or repair your couch, replaced or refurbished your nicked mobile phone (with Theft & Loss cover), and help compensate for the damage caused by the leak in your flat. You’d look back on that night with fond memories—if you remember much, that is—instead of seeing red in your bank account. 

What we’ll do in this article is unpack the basics of contents insurance, all with a minimum of technical jargon. We like to keep it simple. While you might not end up waxing lyrical about contents insurance—not everyone gets as excited about it as we do — at least you’ll have a handle on how these policies can help make your life a little easier. 

  • Contents insurance offers you financial help if bad things happen to you or your stuff. In exchange, you pay monthly payments (your ‘premium’) to your insurance company.
  • Contents insurance has 3 main coverage areas; contents cover, temp accommodation cover, and personal liability cover
  • If you have an item worth £2K you’ll need to add it as a high-value item for it to be protected for it’s full value.
  • Your contents insurance covers basic perils like fire, windstorm, and burglary inside and outside your house but doesn’t include theft outside the home. If you want to cover your stuff for theft outside the home, buy Theft and Loss cover. Add-ons are extras that can be applied to your base policy, giving you additional cover in the event of specific circumstances.

Here’s a quick preview of what we’ll be discussing:

What is contents insurance?

In plain English, contents insurance offers you financial help if bad things happen to you or your stuff. In exchange, you pay monthly payments (your ‘premium’) to your insurance company. Think of contents insurance as a safety net. It’ll kick in and help if there’s loss and damage from designated perils, which include theft, fire, vandalism, certain types of water damage, and many other inconvenient incidents and circumstances.

Now, we say that an insurance policy “covers” you from unfortunate incidents, like fires, or a break-in. But that’s just an expression, since the insurance company itself isn’t preventing those things from happening… instead, it’s providing financial compensation if they do happen.

If your entire flat is damaged to the point where you’re unable to stay there, contents insurance may compensate you for the nights you might need to spend at that Holiday Inn. And if you’re held liable for causing property damage or accidental bodily injury (then it’ll help with possible medical or legal expenses.
BTW: Home insurance is the term for both contents insurance and buildings insurance together—but they’re always sold as separate cover. So, contents insurance can protect you as a renter and as a homeowner.

What does contents insurance cover?

A typical contents insurance policy (also sometimes known as home contents insurance) has three main categories of cover:

Let’s take a close look at each.

1. Contents cover

The main sub-category of your contents insurance policy is, somewhat confusingly, also called contents. This first part of your cover helps you recover the cost of damaged or stolen property if various unpleasant or unexpected things happen. That includes nearly all of your personal belongings: furniture, jewellery, electronics, games consoles, crockery, and yes, even your clothes and shoes. That said, there are some exclusions (contents insurance won’t cover items you’ve borrowed from a friend, or property that belongs to your employer). 

Your policy will cover your stuff against specific, named perils: very not-fun occurrences like fires, lightning, smoke, explosion, burglary, robbery, vandalism, civil unrest, windstorms, hail, earthquakes, flooding, collision by vehicles, aircraft, falling objects, water damage, to name a few.

So let’s say your kitchen had a small kitchen fire, your kitchen appliances would be covered and any other items that got ruined.

2. Temp Accommodation cover

If covered perils (like fire, water damage, burglary, etc.)  cause your place to become unlivable, you might need to hole up in a hotel for a while. The good news is that your contents insurance policy will cover this and other expenses, possibly including any extra cash you need to spend on your own food and laundry.

3. Personal Liability cover

Contents insurance cover extends to instances in which you are liable for causing damage or injury to someone else— called personal liability cover, whether that means repairing or replacing a damaged item, or covering hospital bills or legal expenses from a lawsuit.

It also extends to certain damages that you may cause when you’re abroad for trips or away from home (of up to three months). We also cover damage you may cause to your rental home and your landlord’s stuff, but this doesn’t extend to normal wear and tear like scratches or stains. BTW, remember that if you want to really extend your personal liability you can supercharge your policy with Legal Protection cover [see add-ons for more info!].

What doesn’t contents insurance cover?

Contents insurance isn’t a cloak of invincibility. It won’t protect you against every crappy thing that can happen on a daily basis, so it’s good to keep in mind what’s not covered by your policy (these are what are known as “exclusions”).

1. Car-related damage

You park your car at the corner and leave your phone on the passenger seat. If someone pulls an old-fashioned smash-and-grab to get your iPhone X, contents insurance has your back for the device (if you’ve added Theft & Loss to your policy), but it won’t cover damage to the car itself, like your broken window. The same applies if some drunken weirdo decides to rip off your rearview mirror for fun. You’ll need the right kind of car insurance for that one.

2. Your housemates’ stuff

You’re super responsible, which means you have a Lemonade Contents insurance policy. But you live with three others who don’t. If their stuff gets damaged or stolen, your policy can’t come to their rescue (unless you have told us that you share your home with them when purchasing your policy). If your housemates aren’t up to speed on why contents insurance is a brilliant idea, well… you can tell them yourself after finishing this article 😉

3. Damage from pests

Your contents insurance won’t cover damage related to mice, rats, or insects. If rodents devour your food, or termites destroy your desk,  your policy won’t help. Extermination costs also won’t be covered—that’s generally your landlord’s responsibility. And what about that scourge of all scourges… bed bugs? Treatment can be really expensive and time-consuming, and contents insurance won’t cover those costs.

4. Property damage to your actual home

Contents insurance doesn’t cover the physical structure of your home. So, if your place has roof leaks, it’s your right as a tenant to demand your landlord provide a dry roof over your head. Before you sign a lease, it’s worth asking about the landlord’s insurance they carry, as well as what the protocol is if something happens to the building’s actual structure. If you’re a homeowner, your building’s insurance will cover any structural damage.

Let’s get a little extra

If you’ve got some seriously pricey items valued over £2,000 (per item), they’re also covered by your contents insurance— but you’ll need to add some additional cover for your high-value items in your insurance policy. In insurance terms, that’s known as adding scheduled personal possessions cover.

For a slightly extra cost, you can add additional cover for your high-value items like paintings, sculptures, and some other artworks; watches; musical instruments; and jewellery, amongst other things. A lot of these items might already enjoy a certain amount of cover on your base policy, but adding your high-value items increases the limit above £2K, up to the full worth of the item. 

Adding this additional cover is simple, and can be done via the Lemonade app. While these things may need appraisals or other proof of purchase — you can often add your high-value items to your policy for an additional cost. But don’t forget, this allows you to cover high-value items over £2,000 but if you want to protect them for most eventualities you’ll need to purchase an add-on.

So now we’re being a little bit extra; let’s talk about add-ons. Purchasing add-ons is a bit like double glazing your windows – it’s really adding that extra layer of protection. At Lemonade our contents insurance policy has four add-ons that are personalised for your life: Theft & Loss cover, Legal Protection cover, Accidental Damage cover; and Accidental Damage to Mobile Devices cover.

Supercharge your cover

Add-ons are extras that can be applied to your base policy, giving you additional cover in the event of specific circumstances.  At Lemonade we have 4 of them:

4 superpowers

Theft & Loss cover

On your base policy you’re covered for a bunch of different bad things that could happen to you, including straightforward cases of robbery or burglary inside your home. But with the Theft & Loss add-on your stuff is also covered against theft and accidental loss inside and outside your home, as long as you’ve taken reasonable care to protect it.

So, if your mobile phone or your bicycle gets stolen or lost outside your home, you’re covered. (Just remember not to leave your phone unattended, and to lock up your bicycle with a high quality chain or U-lock, otherwise your claim might not be covered). Another great perk of this add-on is you’re also covered if your house keys are lost or stolen. If this happens, we’ll cover the necessary costs to replace the locks or keys (facepalm).

Legal Protection cover

You get a certain amount of personal liability cover on your base policy, so you’ll be partially covered if you cause damage to someone else or their property. But adding the Legal Protection add-on will give you a bigger shield. For instance, we’ll provide legal protection in case of disputes related to personal injury, your home, your employment, consumer agreements and clinical negligence causing you injury.

Accidental Damage cover

This add-on covers your stuff against damage that is sudden and unexpected, even if it’s your fault. So let’s say you accidentally spill coffee on your brand new rug or knock over your TV—you’d be covered. The only catch is this add-on doesn’t apply to your mobile devices or gadgets, like your smartphone, laptop or tablet. But that brings us to our final add-on…

Accidental Damage to Mobile Devices cover

A mouthful, we know, but this one says what it does on the tin. If you accidentally drop your phone down the toilet after a few drinks while trying to order an Uber — you’d feel silly, but you’d be sorted. We partner with BeValued, who will actually come pick up your damaged mobile device and repair it using only original parts. What if your device needs to be replaced? Smartphones will be replaced with a refurbished, Grade A (mint condition) mobile. All other devices will be replaced as-new.

Getting your contents insurance quote

The price you’re offered for contents insurance—known as your quote—depends on a constellation of factors including the level of cover. Your premiums could be affected by how much high-value stuff you own, your own personal insurance claims history, and the amount of cover you set for yourself. 

  • If you want more cover, it’s going to…well, cost more. Let’s say you want to protect £10,000 worth of your stuff. Increasing your contents limit to £40,000 would bump your premium up.
  • Adding certain high-value items will also incur extra costs, but you’ll probably be grateful that you chose to do so if your engagement ring or vintage guitar goes missing or gets damaged.
  • You set your excess when you purchase your policy. An excess is an amount of money you choose when purchasing a policy that will be subtracted from any future insurance claims payouts. The higher your excess is, the lower your premium could be, but keep in mind that a higher excess also means you’ll pay a lot more out of pocket in the event of a claim.

The easiest way to find out what your own rate would be is to go ahead and apply for a quote.

Our charming AI bot Maya will walk you through all the specifics and get you a rate in minutes(without faffing around with policy documents).

Do you actually need contents insurance for your flat or house?

We’ve talked a lot about worst-case, nightmare-style scenarios.

Fingers crossed that this bad stuff will never befall you, and that you will pass your days blissfully free of random theft, electrical fires, exploding water pipes, or other annoyances and minor tragedies.

But as we know pretty well by 2022, life is full of the unexpected, and it can change in an instant. Contents insurance can’t stop terrible things from happening, but it can make life a little easier if and when they do.

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Please note: Lemonade articles and other editorial content are meant for educational purposes only, and should not be relied upon instead of professional legal, insurance or financial advice. The content of these educational articles does not alter the terms, conditions, exclusions, or limitations of policies issued by Lemonade, which differ according to your state of residence. While we regularly review previously published content to ensure it is accurate and up-to-date, there may be instances in which legal conditions or policy details have changed since publication. Any hypothetical examples used in Lemonade editorial content are purely expositional. Hypothetical examples do not alter or bind Lemonade to any application of your insurance policy to the particular facts and circumstances of any actual claim.