Most people know the importance of home insurance for covering their buildings and property from damage and theft, but many people are not aware of the different types of insurance cover, and this could result in them being underinsured in the event that they need to make a claim.

The two main types of home insurance are buildings insurance and contents insurance, and it's generally recommended to take out both types to ensure your home, valuables and other property are all covered. As with other types of insurance, the level of cover offered by these policies can vary significantly between insurers, so you should always compare home insurance from several companies before you buy, to ensure you're getting the best value for your money.

Buildings insurance covers the actual structure of your property, including the walls and roofs, and may also cover damage to outbuildings such as sheds and greenhouses or outdoor structures like fences, depending on the terms of the policy. Buildings insurance can be vital if you live in areas that are at higher risk of flooding, as the cost of repairs to your home's foundations and other structures could be expensive without the right level of cover.

Contents insurance covers everything you keep in your home which is not a permanent fixture, which can range from carpets and furnishings to entertainment systems. A simple way to distinguish contents insurance from buildings insurance is to consider whether you could conceivably take a certain item with you when you move to a new property - if this is the case, the item will likely be covered by contents insurance. If you are renting your home, buildings insurance will usually be taken care of by your landlord, but you may need to arrange your own contents insurance to cover your belongings.

Because most people choose to take out buildings and contents insurance, most insurers will combine these into a single, cost-effective home insurance policy. However, there may be other aspects not covered by either of these types of policies, depending on your circumstances, which could require taking out a more specialised policy.

This can be the case for buildings that are perceived to be at higher risk of damage and subsequent insurance claims, which could result in expensive premiums if standard insurance policies are taken out. For example, owners of a cottage with a thatched roof that is at higher risk of catching fire than a building with a tiled roof could benefit from a specialised thatched roof / cottage policy.

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