Insurance is all about assessing risk. The insurer cannot inspect every property before the policy is issued and must rely on what you say to decide what the premium rate should be. It's the same if the circumstances change. You should notify the insurer if anything changes that could affect the risk. The bad news is your failure to make a full disclosure entitles the insurer to cancel the policy. Hopefully, this will encourage you to be as honest as possible. As an example, suppose your grandfather is a smoker and lives with you. Having an older smoker in the home increases the risk of fire. Accidents happen if people fall asleep with a cigarette in their hands. So it's very relevant if your grandfather moves into a managed care facility. With no one in your home smoking, you will be entitled to a premium reduction.

The idea of different generations in the home is the historical view. Conservatives like to think of "home" as being for the family. Last century, women stayed home to be mothers and carers. This was good for security. With someone in the home for most of the time, there was a smaller risk of burglary. Premiums were lower. Now we have the nuclear family, i.e. divorce and separation is increasingly common, women go out to work and older people live on their own. This means far more people move into and out of "homes" than ever before. Children get married and move out. They separate and move back in. They leave to go to college and move back in because they cannot find work. As all changes in the number of people sharing the home is probably going to be reflected in the value of the contents, you must keep the insurer up-to-date. All significant reductions in the value of the contents means a reduction in the premium. So, if your teens are disappearing to college with expensive sound systems, PCs and digital equipment, it's probably time to do a survey of the value of your contents generally. Remember you do not insure the retail cost of replacing all your old belongings. There's a rule you cannot benefit from an insurance claim. You are only entitled to be put back into the position you were in before the claim, i.e., you can only collect the secondhand value of what is lost. Go room to room and make a rough list of what you own and how much it would cost to replace in the same condition. If some things have become collectible, start a separate schedule for more expensive items.

Home insurance is reasonably easy to deal with but always remember to keep track of the value of the contents. Allow for loss in value through wear and tear. This will save time and annoyance when it comes to arguing with the company should there be a claim. The more realistic you are now, the easier it will be to agree the valuation later. Always get multiple home insurance quotes when there's a change of circumstances. You want the best value possible during these difficult economic times.