Home Insurance vs. Home Contents Insurance: Which Is Better?
When buying a new home, be it a Build-To-Order (BTO), a resale Housing Development Board (HDB) flat or Executive Condo (EC) or private properties, understanding the right insurance to safeguard your property is crucial. As new homeowners, distinguishing between home insurance and home contents insurance can be confusing, and it's important to know which is more suitable for your particular needs.
This quick guide will help you identify the distinctions between these two insurance types, and give you some tips on deciding which is the most appropriate option for your home.
Key Differences In Home Insurance vs. Home Contents Insurance
| Home Contents Insurance | Home Insurance | |
|---|---|---|
| Building coverage | Home Contents InsuranceNone | Home InsuranceUsually cover both the building and the contents within, such as furniture and personal belongings |
| Perils covered | Home Contents InsuranceTypically covers specific perils such as theft, fire, smoke damage, water damage (like burst pipes), vandalism | Home InsuranceOffers a wider range of perils, including burglary, water damage, natural disasters and personal accident coverage |
| Contents coverage | Home Contents InsuranceMore flexibility in customising of specific coverage in terms of the value of individual items and certain types of risks or valuables | Home InsuranceMay have lower coverage limits for personal belongings as compared to a standalone contents policy, which may require additional riders or policies |
| Premium | Home Contents InsuranceMight be lower compared to comprehensive home insurance as they only cover personal belongings within the home | Home InsuranceMay be higher as it is providing a broader range of coverages, including structural damage, personal liability, and possibly additional living expenses in case the home is uninhabitable |
| Personal liability | Home Contents InsuranceDoes not usually include personal liability coverage | Home InsuranceCan provide personal liability coverage, protecting against third-party claims |
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Best Home Insurance In Singapore
| Best for | Home insurance plan | Estimated annual premium rate (as of 12 December 2023) |
|---|---|---|
| Best for Fire Insurance | Home insurance plan FWD Home Insurance - HDB 3 Room, 4 Room and 5 Room plans | Estimated annual premium rate (as of 12 December 2023)From $61 |
| Best for Fuss-free coverage | Home insurance plan Singlife Home Lite and Standard plans | Estimated annual premium rate (as of 12 December 2023)From $71 |
| Best for Emergency home assistance services and cash allowance | Home insurance plan Tiq Home Insurance plans | Estimated annual premium rate (as of 12 December 2023)From $81 |
| Best for Home contents coverage | Home insurance plan MSIG Enhanced HomePlus plans | Estimated annual premium rate (as of 12 December 2023)From $120 |
| Best for Personal liability coverage | Home insurance plan AIG Home Advantage | Estimated annual premium rate (as of 12 December 2023)From $202 |
| Best for Reimbursement of home cleaning expenses due to infectious disease outbreak | Home insurance plan Sompo HomeBliss insurance plans | Estimated annual premium rate (as of 12 December 2023)From $107 |
| Best for Renovations | Home insurance plan Hong Leong Home Protect360 Gold | Estimated annual premium rate (as of 12 December 2023)From $444 |
| Best for | Home insurance plan Estimated premium rates are based on the information provided on 12 December 2023 on MoneySmart’s Home Insurance comparison page. |
Which One Suits Your Home Better?
The answer to this question depends on your specific situation. A standalone home contents insurance plan may or may not be enough to fully protect your home contents within your property, and it may be more apt if you’re renting a property.
If you want to have coverage for a wider range of perils and additional coverage options, perhaps home insurance may be a better option for you. Below are some factors to consider before you make the decision.
Evaluate the value of your home contents
Examine the limits of coverage for both the building and personal items.
Be aware of exclusions in the policy, such as damage from wear and tear typically not being covered.
Assess the need for additional protection
Consider obtaining extra coverage for high-value items, accidental damage, or certain disasters that the standard policy doesn't cover.
Analyse premiums against deductibles
Weigh the premium costs against deductible amounts as opting for higher deductibles can reduce premium costs but increase out-of-pocket expenses when filing a claim
Search for discount opportunities and package deals
Investigate if insurers provide discounts for combining various insurance types or for implementing safety measures like security systems.
Examine customer feedback and company ratings
Seek out reviews and ratings on the insurer's customer service and efficiency in handling claims.
Tailor to your lifestyle
If your lifestyle involves frequent travel or specific needs, make sure your insurance policy aligns with these aspects.
Stay updated with your insurance policy
Regularly review and update your insurance coverage to reflect any changes in your circumstances, such as acquiring new valuable possessions.
Frequently Asked Questions
Is home insurance better than standalone home contents insurance?
- Yes and no, it really depends on your housing and financial situation, as well as your home’s needs and requirements. A standalone home contents insurance plan may or may not be enough to fully protect your home contents within your property, and it may be more apt if you’re renting a property. If you want to have coverage for a wider range of perils and additional coverage options, perhaps home insurance may be a better option for you.
Are standalone home contents insurance cheaper than home insurance?
- Yes, standalone home contents insurance often costs lower as compared to comprehensive home insurance as they only cover personal belongings within the home, unlike home insurance plans which provide a broader range of coverages, including building coverage, structural damage, personal liability, and possibly additional living expenses in case the home is uninhabitable.