This is according to Graeme Trudgill, the British Insurance Broker's Association (Biba)'s corporate affairs executive, he said that the flooding of last year showed just how important home insurance is, it also brought to life that 25% of homeowners did not have adequate cheap home insurance policies.

Trudgill elaborated: "Home insurance is absolutely the second most important insurance you can buy. The first is motor insurance if you have a car because it is a legal requirement but home insurance is critical for several reasons.

"Firstly, if you have a mortgage there will be a contract between you and the mortgage provider which almost certainly says that you have to take out buildings insurance and if you don't you will be in breach of your mortgage contract."

All of people's “worldly goods and investments” are tied up in their home, if people do not hold sufficient home insurance policies they could lose everything if anything happened.

"Insurance premiums for buildings and contents insurance have hardly changed in the last ten years - they are very low, they are great value for money and it's really competitive out there at the moment," Trudgill concluded.

Another time when home insurance is vital for mortgage holders, according to Homebuilding and Renovating magazine, is during any renovation work on a house. Having a good home insurance policy will cover home owners in the event of a mishap, if people are not covered properly by their insurance they could suffer a significant financial loss if anything goes wrong with a renovation.

Editor of Homebuilding and Renovating magazine, Jason Orme, highlighted the importance of fully insuring a property during any ongoing renovation work, regardless of how big or small a project is.

During DIY work on a property, home insurance is not likely to be at the forefront of home owners minds, however this is an essential time to make sure you are properly covered. Accidents can often happen when decorating or renovating a property, spilled paint, damage to walls from mis-placed drilling or other damage caused by DIY work can cause the need for costly repairs, a good home insurance policy will cover you for this damage and will mean you do not need to put your hand into your pocket.

Mr Orme stressed that home insurance options should be fully considered even when bringing in professional to decorate or renovate your property for you. He said: "If you are undertaking substantial work and you need to move out then you need to [obtain] specialist renovation insurance - that's very similar to the insurance people take out when they're building their house," he advised.

He continued: "If you're doing a loft conversion or a small extension, that tends to be something that you can get specialist small-level [home insurance] for, possibly from your existing home insurance provider."

If you do not have sufficient cover and anything should go wrong during any renovation work on your property, you will be fully liable for any reparation costs incurred. This is why it is important, not only to have home insurance cover, but to know exactly what it covers you for and to make sure all eventualities are covered.

Different insurers will offer varying levels of cover, it is important to check, before taking out your policy that you will be covered to the level you will require. Your insurer will be able to answer any questions you have about your policy and clarify which specific renovations you are insured for.