Whether you are going to use your property in France as a holiday hideaway or let it for investment income, it is essential that you arrange suitable insurance cover. Most insurers see bigger risks associated with holiday homes because they are often left unoccupied for long periods, prone to burglary and weather damage, therefore finding suitable insurance can be difficult.

But do you arrange cover with a local broker or a UK based insurer? When exchanging contracts your French agent or notaire will need proof that you have suitable insurance, or they may recommend a French Insurer. Before you choose a foreign policy it is important that you read the small print so you understand the scope and restrictions of cover. Unless you are fluent in French this can be a problem.

You may find that policies offered by French/European insurers are cheaper, however cover tends to be much more limited than UK policies, so a saving of £50 could prove costly in the event of a claim. You may be better off choosing a comprehensive policy in the UK that’s written in plain English and specifically designed for French holiday homes.

What cover do you need for your holiday home in France?  

Buildings Insurance

Building insurance should cover the actual structure of your French house, outbuildings, garages, swimming pools, walls, gates and fences. These tend to be covered against the cost of repairs or rebuilding, debris removal and professional fees following loss or damage caused by earthquake, fire, storm, flood and burst pipes. Building insurance should also cover permanent fixtures and fittings within the buildings, such as fitted kitchens and bathrooms. Some French policies may exclude swimming pools and outbuildings from the buildings cover so check.

How much should you insure for? Most people think they should insure for the current market value of their house in France. This is wrong, the sum insured needs to cover the cost of rebuilding the property. The rebuild value is the full cost of reconstruction of the building in its present form. This amount must include all outbuildings, barns, domestic oil & gas pipes, domestic oil fuel tanks, swimming pools, tennis courts, drives, patios, terraces, walls, gates and fences.

Calculating the rebuilding cost of French property can be difficult, especially if you have bought an old cottage or farmhouse. You might find the rebuilding cost of such a property is more than the actual market value. To calculate the rebuild value of your holiday home you should ask a local builder, or surveyor to provide an insurance valuation. Your lawyer or vendor may also be able to advise you on the rebuild cost. Alternatively if you had a survey report done on the property, there may be a rebuild figure listed for insurance purposes.

It is important to get this figure right because if you underinsure you may not get the full amount you were expecting in the event of an insurance claim. Most insurers will automatically index link, which means the sum insured will be adjusted yearly to take into account changes in rebuilding costs.  

Contents Insurance

Contents insurance covers everything you would take with you if you moved home. This typically includes general contents within the home such as furniture, furnishings and electrical equipment. Most policies cover your contents in the event of fire, storm, flood and theft.

To calculate the contents sum insured you should work out how much it would cost to replace your contents on a new for old basis at today's prices. It is important that you get this figure right and don't undervalue your contents, as in the event of an insurance claim you may not get the full amount you were expecting.

French house insurance policies do not usually cover personal valuables as most properties are often left unoccupied for long periods or commercially let. If you take valuables to your holiday home you should insure them under the all-risks section of your main household policy or travel insurance.

Are you protected if you let the property to someone who breaks a chair or microwave? If you are going to use your French home for holiday letting choose a policy that covers accidental damage to contents. Guests often aren't as careful as you and accidents do happen.  

Legal liability Insurance

It is very important that you choose a policy that includes public liability insurance, especially if you are planning to let your holiday home. These are litigious times and liability insurance will cover you for legal costs and expenses following death, injury or damage to a third party on or near your property. For complete peace of mind a minimum indemnity of £2m is recommended.

Even if you aren't planning to holiday let your property in France, it is still advisable to get suitable liability cover. What would happen if you let a friend use your holiday home and they slip in the shower, break a leg and have time off work. Maybe they would have to take legal action against you?

If you have a swimming pool ensure that in the event of an accident you are covered under your public liability insurance. You should also check the insurers requirements regarding the French pool safety law because you may discover that unless your swimming pool is properly gated, some insurers may invalidate your cover.

Cover when holiday letting loss of rent and alternative accommodation

If you plan to commercially let your house in France it is important that you choose a policy that allows you to. Some insurers only cover use by friends and family as letting can increase the risk of a claim.

One of the biggest worries when holiday letting is if an unforeseen incident results in your property becoming uninhabitable as a result of, say, a burst pipe or a fire. During the peak holiday season such a disaster could mean thousands of pounds in lost income and a huge inconvenience. Choose a policy that will allow you to claim for the loss of rental income and pay for alternative accommodation for you and your holiday guests.  

Do premiums include local taxes?

Insurers are required to collect insurance taxes on behalf of the Government, so check that any taxes are included in the final price of the premium, including the levy for “Natural Catastrophe” cover.

The French insurance code directs if a Ministerial decree is issued certifying that a natural catastrophe has occurred, your Insurer is required to indemnify you for any damage you have sustained.

In addition to the premium the following charges are made to premiums charged for French properties:
Premium Tax
Terrorist Fund
Natural Catastrophe Levy  

What are the policy conditions?

Most insurance policies for French holiday lets and second homes have conditions in the small print that must be followed. It is important you read and understand the policy wording before you buy the insurance to be sure the cover is right for you. Hopefully this will prevent any complications in the event of a claim.

Is there a clause that excludes cover if the house is uninhabited for more than 30 consecutive days, or when let to non-family?

You will find that most policies exclude cover if the property is unoccupied for more than 30 consecutive days, the property must be visited every week, and on special locks, shutters being installed. Some insurers also insist the water system must be drained when left unoccupied, and the property is heated constantly to a certain minimum temperature. Would you be insured if your electric heating failed due to a power cut and a burst pipe occurred?

As your French property is hundreds of miles away such requirements can be a great inconvenience so try to choose a policy that does not have these stipulations.  

Making a claim and language problems

One last thing to bear in mind is what happens when you need to make a claim:
Will your insurer be capable of sorting out a claim when you are hundreds of miles from your French property?
Does your insurer have the authority to manage and make decisions in-house, or is the claims handling process out-sourced?
How quickly will you receive settlement and do you have to fill out claims forms in French? (this can be a problem if your knowledge of French is low)
Make sure you are aware of the policy excesses in the event of a claim. These can be substantial especially for earthquake claims where some insurers charge a percentage of the sum insured.

Understanding exactly what a policy covers in the event of a claim can be a challenge, even in English. If you choose a policy written in French, have the document properly translated so you understand what you are getting. You may be better off buying a policy in the UK that’s written in plain English and claims are resolved by a UK-based experts.

Under the terms of a UK policy, if you are a UK resident, UK law applies so you don’t have to worry about complications regarding French laws. You will also enjoy greater protection if the insurer is regulated by the Financial Services Authority.  

Other considerations

Leave a key with trusted neighbours who can check your property frequently, to reduce the risk of theft and damage

Beware of freezing pipes in the winter months. Leaving the heating on (thermostatically controlled) can minimise potential danger and water damage.