I've been seeing the news of the awful flooding in Cumbria. Other areas have suffered over the years. A significant precentage of people have no contents and/or buildings insurance.
Now then, if you drive a car you have to have car insurance - 3rd party is the minimum I think (I am happy to be corrected on that) which allows others to not suffer too much by our driving. That makes sense.
Given the suffering that can happen when a house is badly damaged by flooding etc, I feel it would be a good idea if basic insurance was mandatory for all owners of dwellings. It would cover basic structural repairs (walls and roof), replacement of internal plasterwork, restoration of gas, electrics, water and sewerage (assuming they were already there) and making secure with doors and windows.
I think this is especially important on non-detached houses but even detached should be included.
When money is tight it is so easy to cut out the optional stuff. But when the worst happens it is suddenly not so optional. Making it mandatory would prevent so many people doing without and getting caught in their own personal disaster zone.
What do people think?
I have always been under the impression that buildings insurance was compulsory. Well if you have a mortgage on it, as the lender wants to protect its investment.
I do not think it should be made compulsory if you own the property though. You take the risk if you do not. Bit like fully comprehensive car insurance, but you should not then get any help with repairs from the government if you do not !!!
This is of course tragic to see.
As has been said above IF you do not own your home but are buying it, then building insurance is compulsory.
IF you own your own home and do not have any insurance then sorry, your a bit of a wally especially living near to rivers.
Contents is something different. I know people who have quid homes yet have no contents insurance....bloddy idiots I would say.
I just hope that everyone of those poor people DO have all insurances up to date, IF they do not then just like me the insurance companies should not pay. Tragic but where do you draw the line?
Should it be compulsory? Yes it should be, a bit like car insurance.
The problem being if you live in an area which has flooded before and you have had to claim you premiums go up and I watched a program a while back people who lived in areas that flooded on a regular basis and there was one couple who just couldnt afford the premiums anymore, but also couldnt sell their house because of it being flooded twice in 5 years.
Yes you do have to have building insurance if you take out a mortgage, but there is nothing to stop you cancelling it once you have the mortgage and in the 16 years I've had mortgages the mortgage company has never asked to see a copy of the insurance.
I know from conversations I've had with people from Lewes that it is not always possible to obtain building insurance. The insurance companies are obviously far too poor to take a risk on a house if it is in an area that has a history of flooding.
For many buildings insurance is just becoming unaffordable. Companies are increasing premiums out of all proportion of the owners ability to afford them. It requires a national solution to a problem that once again hits the poorest the hardest.
The problem is that any insurance always hit the poorest as the cost of insurance is currently not proportional the the cost of the items insured !!!
It does depend on the definition of unaffordable ?? Its only unaffordable if you never need it. If you do it is good value for money.
The only way round it would be to have a set charge for properties, much like car tax. But then we are essentially being taxed yet again :sad:
What Brighton geezer said. Compulsory buildings insurance isn't possible as insurers will simply not insure some properties, based on either past or predicted flooding in the area. The problem is only going to increase as climate change hastens. Something we're just going to have to adapt to - but hell, millions of people have dealt with similar in countries that enjoy regular monsoons for a very long time...
I think you can measure it this way; given that you pay £1000 per year on insurance and you have no claims in 10 years and the cost of replacing your entire stock is £5000 (he ran a sweet shop), a claim in year 11 will realise a saving of £5000 (in basic terms).
If the owner has been prudent and put the money aside each year, he can restock immediately.
What he would miss out on though is business continuance insurance - that is the money the policy would provide for renting alternate premises but in the example provided, he has £5k available for that.
If his policy costs were £10k and he had a £2k excess, he has saved himself that amount over the term.
Like everything else in business, it's a gamble. If the insurable event were to happen sooner in this example, he might struggle to get through it if self insuring. In his case of course, he might not need to restock entirely to maintain his business. If he was in your line of business though with expensive machinery to replace, his risk of not being able to continue would be greater.
This of course takes no account of any premises risk requirement. Much of that would depend on the type of lease he has.
That is all true GNV but......
Living near a river he COULD end up claiming every three years. IF that was the case it would be prudent to insure oneself.
Insurance is only good when you need to claim. Yes I am sure there are many people who have never claimed in years, and could adopt the attitude they have saved money over the long run but....having no insurance is a bit of a dumb thing to do, and I bet my super fast motorbike this guy will be insured next year, and the year after and many years to come.
Yes everyone has to weight up the odds and then make a decision as to whether the premium is worth paying.
In my opinion it is very foolish not to have contents insurance for your business.
