How to calculate home insurance

Find out how to pay only for what you have adequately insured, for both buildings and contents insurance on your home

With a home insurance policy you can get cover for buildings and contents on your property. The value of the two parts will affect the annual policy price, since the price of a home insurance policy is governed by what it protects. That is why it is not the same to purchase insurance for your main owned property as it is to insure a second buy-to-let property on the coast or in the country.

Now, what does contents include, and what does buildings include? What does home insurance cover? And, most importantly, how is the price of home insurance calculated? Find out in this article, and discover a competitive option to insure your home.

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The price of home insurance: buildings and contents

When setting the price of home insurance, the economic value of the home contents and the building is assessed. As a general rule, although one company may vary from the next, the “contents” of a property include everything contained in a home, such as furniture, clothing, household goods, domestic appliances, etc. On the other hand, the fixed parts that constitute the property are included in "buildings" insurance. In other words, it covers everything that holds the contents of the home.

The sum of the contents and building is a value that, for the insurer, translates into an annual price agreed in the policy. What criteria are used to assess the value of contents and buildings?


As we have seen, contents is considered to be everything that is inside a home. However, the value of those contents can vary according to quality and age. Likewise, certain objects, such as jewelry, may be considered separately for insurance purposes. Here are some guidelines to help you to insure everything adequately:

  • Domestic appliances and technology: make sure to guarantee the value of your objects. All homes have countless domestic appliances and electronic devices that add up to a significant value. In the event of theft, for example, if any of these objects are taken, they will have to be replaced. This is why it is important that they are included in the insurance policy under their true value.
  • Personal belongings: these are the basic collection of belongings you have in your home. As such, by taking out home insurance you will be protecting your clothes, linens and other personal items from unforeseen eventualities. If you have any highly valuable possessions, such as jewelry or works of art, they should be specifically listed in the policy.
  • High value objects: do you have any jewelry or works of art at home? If the answer is yes and you want your insurance policy to cover their value in the event of a robbery, they must be specially declared when signing the policy. You should know that each insurance company determines what they consider to be jewelry and high-value items (works of art, pictures, coin collections, etc.) and what is the required minimum or unitary value to be considered as such.
  • Other items: it is important that you properly insure everything in your home. As part of home contents insurance, you can insure portable items such as cell phones or computers, even if they are stolen outside the house. Likewise, the most competitive home insurance products offer you assistance in particular scenarios, such as if you require home maintenance (hanging pictures, fitting lights, assembling furniture, etc.) or if you need online or at-home assistance with a computer, tablet or smartphone (data recovery, cloud back-ups, setting parental controls, etc.).


Besides the contents, all home insurance should cover possible unforeseen events on the building (as agreed in the insurance contract), i.e. the walls, ceilings or floors, as well as its installations. That includes the electrical installations, pipes, heating, floors, walls, ceilings and everything that is fixed and belongs to the property. Everything included within the boundaries of the home is included, including any annexes, provided they are for private use. They may be patios, terraces, garages, storage rooms, swimming pools, etc.

By taking out buildings insurance you guarantee that, should the worst happen, as a result of a loss, if the property is completely destroyed (the property burns down) or partially destroyed (a pipe bursts in the bathroom), the insured home can be returned to the same state as before the loss occurred, and the value of the property can be recovered as if there had been no loss.

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How do I save money on my home insurance?

What you have in your home is up to you. As such, a competitive insurance price is that which does not overvalue or undervalue the contents and buildings. Here there is a double risk of incorrectly valuing your belongings:

  • Paying “twice” for certain coverage, such as for a home if coverage is already provided by the property owners' association insurance. There are certain insurance products available in the market for property owners' associations that include the option of certain coverage to a certain level, such as for water damage caused by the pipes of a particular home. Usually, insurance for property owners' associations covers only the damage to common areas of a building (such as a broken mirror in a lobby, a leak in shared piping, a fire in the entrance area, etc.), but everything inside the home should be insured under an individual home insurance policy, to cover any damage occurring inside (such as a broken pane of glass in a hallway door, a leak in a bathroom, a kitchen fire beginning from a pan on the stove, etc). That is why it is essential to know what the owners' association insurance covers, to avoid any surprises.
  • Paying less, which, at the crucial moment, could mean you lose a lot more than money in the event of any damage.

As we have seen, neither option is advisable, for many reasons. If you want to save on your insurance, don't undervalue your belongings and insure your home for what you really have in it.

Another question to consider is if having an alarm connected to a central receiver or a reinforced door in the home may save you money on your insurance. Usually, insurance companies look favorably upon security measures installed in the home. At times, they may even determine whether or not insurance can be provided.

How can we pay less? Another possibility is reviewing how you pay for your insurance, linking together difference policies with the same insurer, or taking out new ones. Some insurance companies offer more competitive pricing when premiums are paid annually (thus ensuring payment of the whole premium from the outset), or a discount when taking out a new policy if you already have products with them.

In this respect, thanks to BBVA Plan EstarSeguro, customers can group the payment of their BBVA Seguros policies and break up the payment into 12 monthly interest-free installments, as well as enjoy cashback of up to 15% on all the policies included in the Plan, depending on the number policies included.

To find out more about what BBVA can offer, and to get your home insurance price, visit As well as buildings and contents for your home, this policy offers additional services at no additional cost, such as the “Manitas” handyman service and online and at-home assistance. Take a look at what our bank can offer you.

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