When you own your home, buildings insurance can offer peace of mind. But not all policies will offer the same level of cover. The good news is, it’s easier than ever to compare buildings insurance online.
Home insurance is a general term used to describe two very different types of insurance, buildings insurance and contents insurance.
Buildings insurance covers the infrastructure of your home:
the cost of rebuilding or repairing a home
permanent fixtures and fittings, like kitchens and bathrooms
Contents insurance covers the things you keep in your home:
computing equipment and TVs
some types of flooring including carpets
Contents insurance and buildings insurance are sold separately but some insurance companies do offer joint policies and sometimes discounts. But the cheapest policies aren’t always the best for you.
Buildings insurance will cover the cost of rebuilding or repairing your home in the event of damage to your property.
Not all buildings insurance is the same so you will need to shop around and compare different policies before you buy.
In this guide we explain what buildings insurance does and does not cover and how you can compare policies to find which one is right for you.
Anyone who owns a residential property will need to consider buildings insurance.
If you are planning to buy your home using a mortgage, you may struggle to get the mortgage unless you take out buildings insurance.
If you’re a landlord, buildings insurance is your responsibility – not your tenant’s - and should be a top priority.
If you own your home outright, buildings insurance isn't compulsory, but you should think about how you would afford to rebuild your house if it were damaged or destroyed.
Buildings insurance will cover up to the full cost of rebuilding your house, should it be damaged or destroyed. This is likely to include demolition, site clearance, and even architects' fees.
Garages, sheds and fences are also covered, as well as the cost of replacing items such as pipes, cables and drains.
Buildings insurance covers loss or damage caused by:
fire, explosion, storms, floods, earthquakes
theft, attempted theft and vandalism
frozen and burst pipes
fallen trees, lampposts, aerials or satellite dishes
vehicle or aircraft collisions
car and lorry collisions
This type of home insurance does not cover general wear and tear. There may be other exclusions depending on what policy you buy.
Damage caused by the following is not normally covered:
some pests – such as wasps or birds
frost – although it depends on the cause of the frost
storm damage to gates and fences.
When you take out a mortgage, you can choose which insurer to go with. Your mortgage lender reserves the right to reject your choice of insurer but they cannot make you take out their own choice of insurance.
In some cases, certain mortgage lenders, often the more specialist lenders, will make it a condition of the mortgage that you take out their choice of buildings insurance.
Whatever insurance policy you buy, you should still make sure you read the terms and conditions and know what level of cover you have been offered.
If you are in the process of buying a house, buildings insurance should be taken out as soon as you exchange contracts. This is when you become legally responsible for the property.
If you are selling a house, it is still yours until the sale is complete, so you need to keep your insurance cover until then.
If you are buying a leasehold flat or property, the building might be insured by the landlord or freehold owner. Sometimes your lease may put the onus on you to take out your own buildings insurance, so be sure to check with your lender.
If you live in a flat where the leaseholders have clubbed together to buy a share of the freehold from the landlord, it might be cheaper to take out a block policy.
It can be challenging to calculate a rebuild value, so there are online tools including this calculator from the Association of British Insurers (ABI) which you can use.
If your property requires specialist material such as a thatched roof, or it's a listed building, then you may need to find a specialist local surveyor who can estimate the rebuild cost for you.
You might want to consider taking out extra buildings insurance to cover if you live in an area where subsidence is more likely.
What you pay will depend on what basis the insurance company calculates your rebuild cost.
There are 2 ways an insurer will rate your property:
This method is the most used by insurers. The insurance company estimates the cost of rebuilding your home based on the number of bedrooms, however you may end up paying for more cover than you need to with a bedroom-rated policy.
This is a more precise way of working out the rebuild costs and involves a chartered surveyor calculating the cost of rebuilding your specific property from scratch. With a sum insured policy, you only pay for the cover you need.
Not all buildings insurance includes the same cover, and when it comes to insuring your home, the cheapest cover may not be the best. When you’re looking for the right home insurance deal you have to remember that the level and type of cover is just as important as the price.
It is worth checking whether your policy includes the following:
This means your cover increases with inflation, so it will meet the increasing cost of building materials.
If you cannot live in your home due to damage, then this will cover the cost of somewhere to stay. There will be a ceiling on the amount you can claim, so check how much cover is being offered.
This is the excess set by the insurance provider. You will have to pay this, but you can choose to pay a higher voluntary excess which will reduce your total premium. But you will need to be able to afford to pay it in the event of a claim.
If you don’t make a claim on your buildings insurance you may find your premium gets cheaper but this is not always the case.
Some home emergency services such as heating and plumbing repairs can be included but they will often come at an extra cost.
You can add on extras to your cover but they are likely to involve an additional cost
flooding or subsidence if you live in a high-risk area
accidental damage to your home
damage to boundary walls, fences, gates, driveways and swimming pools
damage to underground pipes, cables, gas and electricity supplies
glass in windows, doors, conservatories and skylights
liability cover if someone else's property is also damaged
legal expenses cover
Insurers are reluctant to cover properties that are unoccupied for long periods. A long period is considered to be 2 months or more.
If you go away on a long holiday, work away from home for long periods or even have to live elsewhere so that home improvements can be made, you will need to let your insurer know.
Other reasons why your property might be unoccupied:
you are waiting for it to be sold or let out
you or a relative has been taken into care
the property is a holiday or second home
If you do own a holiday home you will also need a specialist insurance policy and you must tell your insurer that it’s not your main home.
You can get specialist insurance for homes where no contents or furniture is present.
If you make any changes to your property, such as an extension or renovation you must make sure your buildings insurance cover is up to date
Even if your policy is index-linked or bedroom-rated do not assume you are covered and always check with your insurer.
It is easy to compare buildings insurance policies online. It’s a good idea to make sure you have the following information to hand:
how many rooms your home has
any outbuildings – such as a granny annexe
how old the property is
what the walls are made from
an estimate of how much it would cost to rebuild
If you don’t have an estimate you can still get a quote but it’s a good idea to spend some time researching buildings cover to make sure you buy the right policy for your needs.