What is domestic appliance insurance?

Find out more about domestic appliance insurance and how it can close the gap between home contents insurance and your appliance warranty

When it comes to domestic nightmares there are few things worse than realising your washing machine is leaking water, or that your fridge isn’t actually keeping anything cool anymore.

Our lives are so intertwined with everyday domestic appliances that when things go wrong it can be difficult to manage.

Kitchen appliance cover

Domestic appliance insurance aims to offer you peace of mind that you can always get your appliances fixed, but is it suitable for you?

We take a closer look at home appliance insurance, including what’s covered and how it differs from contents insurance and warranties.

Domestic appliance insurance

Many homeowners and tenants realise the importance of contents insurance, which gives you peace of mind in the event of damage or theft.

Typically expensive appliances in your home will fall under your contents insurance in the event of damage or theft, but what happens if they break down?

While most new appliances will come with a manufacturer’s warranty guaranteeing repairs and servicing for the first year, the most common problems occur outside the warranty period as a result of wear-and-tear.

In this instance, you will either need to replace the appliance or pay the manufacturer to repair your product – two expensive options that could leave you significantly out of pocket.

Appliance insurance aims to plug the gap between household insurance and appliance warranties.

For a fixed fee per month, you can cover your domestic appliances the same way you cover the contents of your home in the event of theft or damage.

Similar to an extended warranty, appliance insurance can be extended to cover a range of different appliances.

You may opt for a kitchen appliance insurance policy that covers all the appliances in your kitchen, which could potentially make it cheaper than purchasing a range of separate extended warranties.

Do you need appliance insurance?

Home appliance insurance is a nice concept and ensures you don’t have to go without your washing machine, dishwasher or fridge/freezer for long periods of time while they’re being fixed, or until you buy a new one.

A good home appliance insurance policy will have a quick call-out number, so you can quickly have any problems dealt with by trained engineers.

However, while an appliance insurance policy is likely to be cheaper than replacing a recently purchased appliance, the value of your appliances should play a huge role in whether you opt for appliance insurance.

If your appliances are already fairly dated, then specialist cover may actually cost more than they are worth.

It is also worth bearing in mind that the promise of an immediate call-out and qualified repair man are only worthwhile if you couldn’t get a call-out without this cover.

The cost of appliance insurance is also worth taking into account when you are looking at replacing your appliances.

If you are struggling to decide between two products based on cost alone, then durability, when taking into account the cost of a warranty or appliance insurance, should also be considered.

What to look out for with home warranty

While the concept of appliance insurance is great in principle, like everything the devil is very often found in the detail, and it pays to read the small print.

Typical exclusions include accidental damage for example, which may limit the value of the cover. There will also be a value limit on individual items – £2,000 per item for example, and an age limit for the items of five years for instance.

Extended warranty or appliance insurance?

You should also be aware that while appliance cover is a close relation it is not the same as an extended warranty.

An extended warranty is offered with one particular appliance, and as such may be more product-specific.

If for instance your washing machine breaks down and one small part needs to be replaced, it may have to come directly from the manufacturer. In this instance, an extended warranty from the manufacturer may be a blessing.

However extended warranties also have a reputation as being poor value for money, and for good reason.

Typically offered at the point-of-sale, extended warranties are not the type of financial product you shop around and compare, and as such are often overly expensive and riddled with exclusions.

If you do look into appliance insurance, make sure you shop around and get a number of quotes.

As well as dedicated providers some energy companies offer appliance insurance, as do some insurers.

Contents insurance – what is covered

Before you look into appliance insurance, you should make sure you have the correct, and sufficient, contents insurance in place.

Buildings insurance is completely separate from contents insurance and covers the structure of your home, from the roof to the beams and fittings in cases of flooding, subsidence, theft, vandalism, fire, lightning or water damage.

Contents insurance meanwhile covers the cost of replacing the possessions within your home. It covers your contents against the same sort of things as buildings cover — you’ll be protected in the case of a break-in or flooding, for example, but it’s unlikely you’ll be covered if one of your appliances breaks down.

It is up to you to cover the correct costs of your products by assessing their value. This can simply be done by going through your home room by room and estimating your items based on current prices.

Just like appliance insurance you should be aware that your cover will usually be limited in value, so if you have any single items that are more expensive you will need extra cover.

Also, just like appliance insurance accidental damage is not typically covered, although you may be able to get it if you pay extra.

You can typically get two types of contents insurance – indemnity insurance which will also consider the age and condition of your items, and new-for-old insurance that will simply update your items, although this will cost more.