Choose your home insurance carefully…and don’t stash your cash under the mattress

If you are under the mistaken impression that you pay for home insurance to give you security and peace of mind in the event of disaster striking, then read that small print again.

After all, it’s not unreasonable to think that if you have cash at home ready for a winter holiday or Christmas shopping, then loss of the money is covered by your home insurance policy.

The fact is that three out of 10 insurers offering home contents cover will not pay if a burglar strikes and takes £500 or more from your home.

In fact, out of 299 policies currently available, 4% (12) of scrooge insurers offer no cover at all for the theft of cash, another 4% (12) will only pay out if you lose up to £250 while 22% (66) refuse to hand over a penny if you lose more than £250.

“It is important to check that your home insurance policy provides an appropriate level of cover,” said Mike Powell, of independent insurance analysts Defaqto.

“Some people may have considerable amounts in money if they’re about to go on holiday or buy something expensive using cash. Coverage for cash differs considerably among insurance policies.

“Burglaries increase during the winter months with the long dark evenings and it’s important that you check that you’ve got adequate cover in case you become a victim.”

Last year, Halifax Home Insurance saw 63% more burglaries in the winter months (October to March) than in the summer months (April to September) – an indicator that is pretty much in line with other insurers who agree sneak thieves prefer the cover of darkness.

If you have expensive home contents insurance, you may well ask yourself why bother paying out if you get nothing back if you have something valuable in your house lost or stolen.

It’s certainly a good reason to spur you in to grabbing that stash of cash and sticking it in the bank – even though the interest paid for the privilege gives a miserly rate of return.

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