Park Home Insurance - your questions answered

Q. WHAT HAPPENS IN THE EVENT OF AN EMERGENCY SUCH AS THE COMPLETE LOSS OF HEATING?
A. Many park home residents are elderly and often live on their own, they may also live in rural areas where access to tradespeople is difficult and so in the event of an emergency, such as a boiler failure, hot water failure, broken door or window locks presenting a security risk to the home or a wasps’ nest it can be difficult to get a reliable, tried and tested tradesman to attend. Some park home policies include a telephone help-line which will put the policyholder in touch with a tradesman, others will actually arrange for a tradesman to visit the home and cover the cost of the repair. Policyholders of PBIS have access to a 24 hour Home Emergency Assistance Service, in the event of an emergency they can call a dedicated number, a tradesman will be arranged and under the ‘Select’ policy the first £1000 of the call out, including parts and labour will be covered, the benefit is reduced to £250 under their ‘Economy’ policy. The service can be used up to three times a year.

Q. WHO ARRANGES PARK HOME INSURANCE AS MY CURRENT INSURER IS UNABLE TOO?
A. Most insurers regard park homes as ‘non-standard’ construction properties which is of course what they are being built predominantly of wood, constructed on a chassis and delivered to site on a low loader. There are also only around 80,000 park homes in the United Kingdom so from an insurer perspective it is a very small potential market. As a consequence most traditional home insurers, including the on-line comparison sites do not underwrite park home insurance and so it is left to half a dozen or so specialist insurance intermediaries to fill the gap, which they do. Most offer their own bespoke schemes so it is a competitive market place in terms of price and there will be differences in the cover and benefits on offer.
Some of the specialist intermediaries such as PBIS are a virtual insurance company responsible for all aspects of the policy from quote to sale, from renewal to claim whilst others will pass claims handling to a third party.

Q. IS PARK HOME INSURANCE COMPULSORY?
A. Whilst motor insurance is a legal requirement insuring property is generally not although it is likely to be a requirement of a mortgage or loan to buy that property. Most park homes are purchased for cash but it is very likely that one of the park rules will be that your home is insured. In this regard the park are entitled to see evidence of insurance on an annual basis, some parks are more diligent than others ! They will take particular interest in the basis of cover which must be new for old, the park home sum insured, which should be sufficient to replace the home as new to include the associated costs of site clearance, re-siting and delivery fees, replacement of outbuildings and any additions such as skirting, porches and decking. And they will also require a Property Owners’ Liability cover covering the liability of the home owner for injury to third parties or damage to third party property for which they may be liable, usually an indemnity limit of £5m will be required.

Q. WHAT HAPPENS IF MY HOME IS BADLY DAMAGED BY FIRE OR FLOOD AND CANNOT BE LIVED IN ?
A. Sometimes damage to the home can be so extensive that it cannot still be lived in, damage caused by fire or flood, a fallen tree or impact by a road vehicle for example can cause a lot of damage. In such circumstances policies will provide a benefit to cover the cost of temporary alternative accommodation, sometimes it can take quite a long time for a home to be repaired, or indeed replaced so the costs can be considerable. The benefits provided will vary, the ‘Select’ policy from PBIS for example includes a benefit of up to £133,000 reducing to £65,000 under the ‘economy’ policy so it is worth checking because 6 months in alternative accommodation can be quite expensive ! 

Q. WHAT ABOUT CONTENTS INSURANCE ?
A. Once again policies will provide cover on a replacement as new basis meaning that if the item cannot be repaired it will be replaced with its brand new equivalent. Most policies now provide for a blanket sum insured, see above, because frankly it is almost impossible to value every single item in the home to ascertain the correct sum insured. Policies from PBIS offer a blanket sum insured of up to £65,000 and £40,000 on the ‘Select’ and ‘Economy’ policies respectively. Contents refers to everything in the home apart from fixtures and fittings and includes carpets and furniture, often provided with a new home, personal effects and valuables, it should also include contents in outbuildings such as sheds and garages but policies will vary.
Cover will also include property in the open such as patio furniture, BBQ’S and garden ornaments but again policies will vary, the ‘Select’ policy from PBIS for example includes up to £1500 for property in the open.

Q. WILL MY WIFE’S JEWELLERY AND MY FISHING EQUIPMENT BE COVERED ?
A. Under the contents section of the policy all valuables ( valuables includes jewellery, cameras, watches, paintings, works of art and collections of stamps, coins and medals) will be insured in the home itself against loss or damage caused by theft and fire for example, depending upon the policy you have chosen cover may also include accidental damage or loss in the home as well. Policies will however be subject to certain limits in respect of high value items and again cover will vary.  The PBIS ‘Select’ policy includes up to £20,000 for valuable in the home with a single item limit of £5,000. If you have any valuable items worth more than £5000 they can be specified separately.
Fishing and other sports equipment will be insured under the contents section in the home and in the outbuildings, against fire and theft, storm and flood, cover may also include accidental damage.
If cover is required away from home policies can be extended to include ‘PERSONAL POSSESSIONS’, this covers property normally worn or carried about the person away from home, cover is usually world-wide and includes accidental damage and loss, ideal for possessions such as spectacles, jewellery, bicycles, cameras, hearing aids, fishing and golf equipment etc. Cover can be selected for individual items or miscellaneous items.

Q. HOW MUCH SHOULD WE INSURE OUR PARK HOME FOR?
A. Whilst the park home should be insured for the amount it would cost to replace it with an equivalent new home, including site clearance, re-siting and delivery fees, outbuildings and additions in practice it is very difficult for the home owner to know what these costs would be. Remember too that in the unlikely event of a total loss the replacement home cannot be purchased direct from the manufacturer, it must be purchased via the park owner.
In the early days of park home insurance the owner was expected to select a specific sum insured and whilst insurance advisors at that time were able to give advice it was never an exact science and under-insurance was a problem on some occasions. Recognising the difficulty posed by under-insurance the format of insurance policies began to change by offering ‘blanket’ sums insured which were more than enough to ensure complete peace of mind. Today most policies are issued on this basis, it takes away the worry of under-insurance, satisfies the park owner and ensures that in the event of a claim there is sufficient cover available to replace everything as new. As an example policies offered by PBIS offer a blanket sum insured of up to £600,000 on the ‘Select’ policy and up to £300,000 on the Economy.
There are some park home insurers who still insure the home for a specific amount, if you are insured with one of them make absolutely sure that the sum insured is adequate, if it is not you will be unable to replace the home as new, which will likely be a park requirement and may therefore have to foot the difference or live elsewhere.

Q. DOES COVER INCLUDE A POLICY EXCESS ?
A. Policy excesses have become a common feature on most types of insurance, they represent the amount that the policyholder must pay towards the amount being claimed and will vary from £25 to as much as £2500 and more. They are an important consideration when choosing insurance for obvious reasons because whilst a high excess may reduce the cost of the insurance it does put people off making a legitimate claim and obviously can be costly to the insured.
Loss or damage caused by the escape of water  is the commonest type of claim and given the timber construction of a park home claims can be expensive, some insurers now apply a £500 excess to such claims which is a considerable amount, others have smaller excesses. Most polices will have a standard excess on all claims, as low as £25 in some cases, as much as £100 in others.
Uniquely the ‘Select’ policy from PBIS is completely excess free, there are no excesses on any claim, whilst the ‘Economy’ policy carries a £100 excess.
Some polices may carry higher excesses where the home is considered to be in a flood zone, in some cases flood loss or damage may be excluded altogether, in other cases an excess of £2500 or more may be applied as well as a premium loading.

This article hopefully provides the answers to most of your questions, if you have any further questions by all means email Paul at [email protected] or call 0800 0385 261 or speak to your own insurance advisor.