Damage insurances - how to chose

[gaijin]

I recently went through my insurance portfolio for personal damages (household, liability, legal protection) and adjusted it. Here are some of my learnings:

Liability insurance: a must-have. It's out of your control if you damage another (expensive) object or person. While you will be able to cover smaller incidents yourself, a worst case (making one or several people disabled for the rest of their lives) can financially ruin you. I am therefore doing maximum coverage with a high deductible. Since incidents only occur very rarely, premiums are relatively low. I have my liability insurance with Ikea.

Household insurance: not strictly necessary, but recommended. Worst case: you have to replace all your household belongings. My assumption: this will not ruin you financially if not insured. Some points:

• Worth revisiting regularly - every three-five years or after the purchase of an expensive item or after a move. Offers from the different companies are in frequent change. There might also have been a price increase to your premium that you didn't notice, which now makes the offer of a different company more attractive.
• There is a great variety of offerings, the most basic being fire, natural disaster and water damage. Theft is optional, though it's included in most basic packages. (Ikea used to not include it, but they might have changed.) You might start cheap and with only the basics. But it's just as your household grows, so should your insurance coverage.
• Total value of your household: I tend to lower the suggested estimate of my total household because:
  • Many of my belongings I bought second-hand. I therefore expect to only get paid the second-hand price which I paid.
  • In general, only insure objects for which you can prove its existence and its value (receipts). I never had to replace my full household. I therefore don't know how far insurance will reimburse anything without receipts.
  • To get an idea of the total value: think of the ten most expensive objects in your household that you would like to be paid for by the insurance. From there, estimate the value of the remaining items.
• Theft outside of the home. I find this a tricky one. This insurance it quite expensive, so I'm hesitant to recommend it. I don't carry that many valuables around, so the total amount that would ever be stolen is relatively low. Of course, it's most relevant if you travel abroad for a longer time. Again, maybe think of the three to five most valuable items that you would like to be reimbursed for if they got stolen outside of your home. I decided not get this insurance.
• Sports and leisure: this is an important one for me, since I have two expensive bicycles. These are the most expensive single objects that I own. Since both bicycles are often outside of the home and not always within my sight, I consider the risk of one of them being stolen or broken as relatively high. Also, I would have to spend a one time large amount of money to replace it if it got stolen or broken. I therefore consider this insurance more relevant for me than theft outside of the home.

I have my household insurance at AXA. To me, they offer the most choice to mix and match the coverage that I need.


Legal protection insurance: not strictly necessary, but worth considering. Two examples are housing and employment. If you rent an apartment and get into an argument with your landlord, it's good to have an expert that you can ask. If you own a home, I would highly recommend a home owner's insurance, since the amounts can get large quite quickly. If you are employed, remember that you as the employee have legal rights. The employer normally has much larger resources in case of a dispute. If you have your own business, I consider legal insurance a must-have. To note: there are many associations or unions offering legal protection as part of their membership benefits. So check if you are not already covered. I have basic legal protection at Generali and renter's protection by the Mieterverband.

 

[Baptiste Wicht]

Thanks for sharing your thoughts on that.

It's great to reconsider one's insurance coverage on a regular basis.

Liability insurance: a must-have.

Totally agree!

Household insurance: not strictly necessary,

I would just nuance that in some cantons this is mandatory. But I completely agree that if you get it, it's important to do it properly with a value that is matching your belongings.

Theft outside of the home. I find this a tricky one.

Yes, this is tricky, especially in Switzerland, where theft is relatively rare. And it's also worth mentioning that some car insurance will cover the theft inside the car, which is quite common, and we could avoid double coverage.

Legal protection insurance: not strictly necessary, but worth considering. T

I am often going back and forth with that one. In a perfect world, most people should not need it. But it seems to me that it's become more and more necessary

 

[gaijin]

I am often going back and forth with that one. In a perfect world, most people should not need it. But it seems to me that it's become more and more necessary

Yes, I also see an unhealthy development. If legal protection becomes more and more common, it becomes more common to handle issues through the insurance. Which makes it harder to handle issues directly (outside of the insurance), therefore increasing the need to get ones own legal protection.