HOME OR AWAY – Where to insure?

Not long ago, a client came to me asking me whether he should insure his brand new one-bedroom apartment purchased in Gibraltar back in England, or whether he should consider doing it locally via a Gibraltar Insurance company or broker. This was an easy question to answer. It is much more practical to insure your house via a Gibraltar Insurance company given the fact that everything is handled in situ, and it is so much easier in case of any problems or issues coming up (and they do come up) as a local company has a much more practical and faster approach to solve your case than another overseas alternative. Furthermore there are no language barriers or understanding of the so-called small print as everything is done in English.

With this first question clearly answered we may proceed to answer several basic questions than come up when organizing the relevant insurance policy with the chosen broker or company in Gibraltar.

What does building insurance normally cover?

Building insurance aims to cover damage for the structure and fittings of your home by the perils stated in your chosen policy. It will normally include lavatories, baths, interior decorations and fitted cupboards. In addition they should include garages, fences, gates, swimming pools, tennis courts and in general terms all outbuildings. A good point to check is if the policy includes subsidence, heave and landslip. This is normally the case if the property is new. If the property is older than ten years a survey may be requested by the insurers but it can still be done.

What contents will the policy cover?

Your policy should include all your belongings including furniture, electrical equipment and appliances, kitchen equipment including food and drink, clothing, entertaining equipment (TV, music equipment, computers etc.) ornaments and valuables. In other words, all the things that you would take with you if you moved to another house. There will be exceptions and exclusions so it is highly recommended that you read the policy carefully and do not hesitate to ask your broker if you are in doubt.

How much should I insure my home for?

Your building insurance policy should basically cover the full cost of rebuilding your property in case it is totally destroyed. This figure does not necessarily have to match the market value of your property. Au contraire, it will more likely match the valuation figure done by the valuation survey provided it is recent one. It should not be older than one year or else you will have to add a little for inflation increases.

With regards to contents these should be covered for the cost of brand new replacement values today.

Will my mortgage bank need a copy?

Most definitely it will need a copy. All banks will ask you for a copy of your insurance policy. Some banks across the border in Spain will insist you even insure via their own insurer or that you take a life insurance policy as well.

Are my personal belongings covered when I am away from home or travelling?

I always recommend my clients to take an all risks policy which includes this. Specifically any loss, accidental damage or theft whilst abroad or away from home. This includes all of Europe or the whole world depending on the policy chosen. At the end of the day you decide which areas or countries must be included.

Will my PC or valuable items like my Swiss wrist watch or top end Smartphone be covered?

Yes they should be covered if your insured house is your permanent address. A point to consider is that you should declare high valuables separately like for instance a good painting or an expensive watch. This is an important factor to discuss with your insurer prior to obtaining your final policy.

Must I be aware of any important exclusions in my policy?

Every policy has exclusions. With this in mind I strongly advise you to read your policy thoroughly and with enough time to spot any issues which can be brought up with your insurer. Most companies in Gibraltar have policies very similar to their UK counterparts. With some local additions like insurance for breakages due to a surge from the electricity supplier.

What about a safe or an alarm. Will these be requested by the insurers?

I highly recommend both and the insurer will make them a must if you declare certain valuables of high standard. It will always give you great peace of mind whilst you are away or abroad.

The following standards are normal to be asked by any decent insurer, and they will nearly always request the following from their customers as far as a minimum security is concerned.

Doors: Outside doors should be made of solid timber and be secured with 5 lever mortice deadlocks or their equivalent. These deadlocks can only be opened by a key so that a burglar cannot use a plastic card to move in the tongue and open the door. Glass doors should be fitted with similar locks.

Windows: Ideally they should have iron bars or grills. Remember that most burglaries occur via unprotected windows.

A good insurance policy covering all the needed aspects is an absolute must even if this means a certain higher cost. Gibraltar is normally very safe but one never really knows. A top class alarm system is priceless and at the end of the day it will give you tremendous peace of mind.