As people worry about the safety of leaving their savings in the bank, more and more Brits are opting to buy a safe and keep their life savings at home, but home insurance might not cover the extra value.
Domestic sales of safes have risen 25 per cent in the last month as economies around the world wobble and savers fret that their savings will be lost, but insurance provider esure has warned that keeping too much cash in the home can leave wary savers' money as unprotected as it was in the bank.
Even if the money is kept locked in a safe, home insurance rarely offers protection for large sums of money, regardless of the security grade of the safe, because the cash element of cover is usually only intended to cover any 'loose change' which in the house.
Homeowners should think twice before transferring their hard-earned money out of savings accounts
and into the home. home insurance
usually covers only a small amount of cash – esure offers £500 cover – whereas the Government offers a £50,000 guarantee for savers who keep their money in a savings account.
In some cases, where the savings provider is owned by the government, such as National Savings & Investment, Northern Rock, or Bradford & Bingley savings accounts
, 100 per cent of deposits are protected.
Using their home as a vault, on the other hand, offers no protection at all in the case of a break-in, where the householder would hardly be able to reclaim any of the money if it was stolen.
"People looking for a safe place for their money should look further than buying a safe for their loft or under-stairs cupboard." warns Mike Pickard, head of risk and underwriting at esure home insurance
. Although a good quality domestic safe is the perfect option for petty cash, perhaps some jewellery, and a spare set of car keys, it isn't a good home for your savings."
esure also recommends other things that people can do to protect cash at home, such as not keeping significant amounts in the house, and checking the contents insurance policy to see how much would be covered in the event of a theft or fire. And, for those who do invest in a safe, esure urges them to get a one with high grade security, and not to leave the packaging for the rubbish lorry to pick up, because this would alert opportunistic thieves that there are valuables in the home, increasing the risk of burglary.
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