- Apr 15, 2015
Hi, I just bought a house and want to contract Insurance for it. I would like to know how to calculate the values to be insured and how to arrange it.
Moderator, Sergio Sanguino
First thing you need to know is the difference between Building and Contents on the policy. Your policy should include all your assets divided into two concepts, the Building, which is the structure of the house and the fixed elements of it (water , gas, electricity …) and the Contents forming those moveable things within the housing (furniture, clothing, appliances …)
The Building of your house should be measure according to its built meters without including the price of land and will vary depending on the quality of construction. Insurance Companies determine it depending on the m2, the area and type of building, so you should tell your Co. the number of m2 and they will tell you the value to insure it.
Regarding the Contents, we recommend you to make an inventory of all your insurable goods, taking pictures of those with special value (jewelry, coats …).
It is to be noted that if you insure your property with a higher value (over-insurance), the company will indemnify the damage that has really suffered, i.e. they will not pay you more even if your value in the policy is higher.
On the other hand, if you insure your property with a lower value (under-insurance), the company, in case of partial loss, may apply the proportional rule, i.e., if your goods were secured 75% of its real value, the compensation will also be 75% of its real value. In case of total loss the company will indemnify you with the maximum capital insured in the policy.
I hope this helps.