What if the sleigh is really a getaway car?

Home contents insurance can ease the pain of burglary, writes Clare Francis

As the amount we spend on Christmas presents rises, so does the lure of our homes to burglars. Gone are the days when children put dolls, Action Man and books on their Christmas lists. Now it's Playstations, Game Boys, computers, bikes. These, plus a camera for dad and a mobile for mum, are certain to light up a thief's eyes.

Direct Line predicts at least 250,000 homes will be broken into over Christmas and New Year. So it's essential householders have adequate home contents insurance - a message many of us have yet to take in. One in four homes do not have any cover at all and many who do are under-insured.

There are two types of home contents cover. Bedroom-rated policies calculate the premiums on the number of bedrooms and main rooms in a house, coupled with the postcode. Liverpool Victoria is one such provider. Its customers have contents cover up to pounds 125,000, far more than most of us would ever need, but it does provide leeway for new purchases. Within this are limits for items such as entertainment goods, for instance, stereos, videos and jewellery. AxaSun Insurance has a similar policy, but maximum cover is pounds 35,000.

Alternatively, in a sum-insured policy, cover is calculated on the cost of replacing items in the home. This is based on a fairly accurate valuation of your home's contents. It is important to be aware of this when buying new items as they could take you above your cover limit. In many cases, you don't need to worry too much about this as insurers tend to increase the upper limits by 10 per cent for a period over Christmas. But it's not an excuse to forget about that new computer or bike, which may need an extension to your cover.

"When you get into the new year and things have calmed down again after Christmas, it is worth reviewing your home contents insurance and double checking that you are adequately covered," advises David Ross, a spokesman for AxaSun.

A sum-insured policy tends to offer greater flexibility and can have more discounts. Like car cover, no-claims bonuses can be accumulated on home contents cover. Whether or not you live in a Neighbourhood Watch area; have a burglar alarm and specified locks; and are an owner-occupier or a tenant are also taken into account.

Insurers continuously stress the importance of reading the small print of a policy and familiarising yourself with what you are and aren't covered for. This may seem like preaching, but many people don't and find, to their horror, they aren't covered when they thought they were.

It is important to watch out for items often taken outside the home where they aren't covered - such as bikes, cameras, mobile phones, camcorders and laptops. Most policies don't cover belongings away from the home unless specifically asked for. However, they are usually insured if you have personal possessions cover (aka all risks). But, even then it is worth checking. "An increasing number of insurers are excluding mobile phones from personal possessions policies due to the frequency with which people misplace them," warns Andrew Marsh, of Liverpool Victoria. Check the terms of your policy.

As with all insurance cover there are considerable price variations between companies, so it's worth shopping around for the best deal. Once a policy needs to be renewed, find out what else is on the market first.

The cover also varies from insurer to insurer. Some include a certain amount of accidental damage in their standard policies but it's not advisable to rely on that. More comprehensive cover is recommended. Some providers also give you the option to pay in monthly instalments, but there can be a fee for doing this. So check.

To show the price differences, we got some quotes for yearly home contents cover of pounds 30,000 on a four-bedroomed detached house in Ipswich.

Sum-insured policies. Direct Line quoted pounds 103.95 a year for standard cover (no accidental damage) and pounds 130 including personal possessions. NatWest's protection would cost pounds 89.95 standard with some accident cover, and pounds 149.49 all risks. Norwich Union Direct would charge pounds 101.24 standard and pounds 146.30 all risks. AxaSun's standard cover is pounds 81, or pounds 52.50 with age, lifestyle, no-claims and owner-occupier discounts. AxaSun's comprehensive cover, including accidental damage and pounds 1,500 personal belongings [all risks], is pounds 100.80 a year.

Bedroom-rated policies. AxaSun also offers a bedroom-rated policy, pounds 72.45 standard and pounds 141.75 all risks. Norwich Union Direct's bedroom- rated policy is pounds 101.02, standard, and pounds 145.01 all risks. Liverpool Victoria only offers a bedroom-rated policy and its quotes are pounds 57.84 for standard cover; pounds 124.35 for full accidental damage and pounds 2,000 all risks.

TAKE COVER: THE PROVIDERS

Provider Rating type Minimum sum insured

Abbey National, 0345 626266 bedroom pounds 30,000

Alliance & Leicester, local branch bedroom pounds 10,500

Bradford & Bingley, 0113 244 6600 bedroom & sum-insured pounds 35,000

CGU Insurance, contact broker bedroom & sum-insured pounds 35,000

Churchill, 0800 200328 sum-insured pounds 35,000

Cornhill Direct, 0800 857565 bedroom -

Eagle Star Direct, 0800 333800 bedroom pounds 35,000

Halifax Direct, 0800 028 2498 bedroom -

HSBC, 0800 277377 sum insured -

Legal & General, contact broker bedroom pounds 35,000

Liverpool Victoria, 0800 345346 bedroom -

Lloyds TSB, 0800 056 0179 bedroom -

Nationwide, 0800 302010 bedroom pounds 35,000

NatWest, 0800 331100 sum-insured pounds 12,000

Northern Rock Direct, 0345 993322 bedroom & sum-insured -

Norwich Union, contact broker bedroom pounds 40,000

Norwich Union Direct, 0800 888222 bedroom -

Royal & SunAlliance, 0800 300660 sum insured pounds 12,000

Sainsbury's Bank, 0500 301030 bedroom -

Zurich, contact broker bedroom pounds 40,000

Source: Research Department, www.trd.co uk