What does buildings insurance cover?
A buildings insurance policy is home insurance that covers the property itself, the bricks and mortar, along with any fixtures and fittings. It does not protect the contents within the home (think of them as everything you could pick up and remove), and you would need to get a separate contents insurance policy to cover your belongings.
While not quite compulsory, if you have a mortgage it is very likely that your lender requires you to have buildings insurance in return for borrowing the money. This is because as soon as you exchanged contracts on a property, you are legally responsible for it.
It is therefore essential to ensure you have buildings insurance in place, from day one, to protect your home from potential disasters outside of your control. A good buildings insurance policy should cover your home for not only fire and floods, but also against storm damage, burst pipes, vandalism and subsidence.
Failure to have buildings cover in place could jeopardise your home, resulting in your having to pay thousands of pounds for repairs, or potentially losing your home altogether and getting no recompense in the worst instances.
How much should I insure my home for?
It is important to not over or under-estimate how much your home should be insured for. You don't want to pay a higher premium than you need to, but similarly, it could be disastrous if you needed to put in a claim and then found out you weren't covered for enough.
Insure your home based on the rebuild value, which is normally lower than the market value. If your home was destroyed by fire, or ruined by flood damage, and you needed to build from scratch, this would be the cost to it rebuild it as it was.
As rebuilding usually costs less than the market value, this brings down the price of your premium.
A surveyor to determine the rebuild cost of your home can be contacted through the Royal Institute of Chartered Surveyors (RICS), or you can use the estimator built into our home insurance comparison tool.
When you compare policies from different providers, it's important you read the small print to find out exactly what’s included. Sometimes policies differ substantially, for example, some insurers will include cover for garages and outbuildings, and others will cover the cost of temporary accommodation should your home become unsuitable to live in following a claim.
Similarly, you will need to decide if you want to pay for additional extras such as legal cover. Clearly it will increase the price of your premium but in the long run it could be worthwhile. You will need to weigh it up and if it gives you peace of mind, it could be worth every penny.
What affects the price of my policy?
There are lots of different factors that can affect the price of your policy, from where you live to the type of building you own.
- Do you live in a flat or house? If part of house or a purpose-built flat then it may be harder to rebuild.
- Whether it is detached, semi-detached or terrace will affect how simple it is to rebuild.
- When the property was built – this will affect what materials it is made from, and therefore the rebuild cost.
- The type of roof it has – if it has a thatched roof, for example, then it’s likely you will pay considerably more for the insurance policy.
- Similarly, the type of wall it has – properties with brick walls can generally be insured more cheaply than those with stone walls.
- The amount of rooms, windows and doors.
- The frame of the house will also affect the price of the insurance, as if it is a timber-framed house it will be more susceptible to fire damage than a steel-framed house.
- The stability of the land and if there is the threat of subsistence will also be a factor.
- And if you are near a river or open water, these could add significantly to the premium as there is a much higher risk of flooding.
Is the property listed?
There are more than 350,000 listed buildings in the UK, and owning one can be a double-edged sword, on one side you have a beautiful and historic house, but on the other it can be impossible to make some changes without consent.
In addition, you are more likely to need specialist insurance. You can check if your home is listed by searching the National Heritage List for England which details all nationally protected sites.
If your building does come under this category, then you can consider paying for specialist valuation before buying insurance as you may be left short if you don’t insure the building for enough and it is damaged.
When searching for a quote, first compare home insurance using our website to see if regular insurers will cover you. If not, try specialist insurers that offer cover for listed and “non-standard” homes such as Hiscox, NFU Mutual and Towergate Insurance.
How to get the best deal on your home insurance
- The most important thing when taking out home insurance is to shop around and not just 'auto-renew' your policy.
- Insurers rely on apathy so do your research and find out where you can get a better deal. MoneySuperMarket's home insurance price comparison tool will let you get quotes from a variety of providers and compare them to ensure you find great prices.
- Increasing your excess will also help keep costs down. The excess is the portion of the claim that you will have to pay yourself so by opting for to pay more, your overall premium will be decreased.
- It's important to be realistic though – don't opt for such a high excess that if you had to put in a claim and pay out you wouldn't be able to afford it.
- Building up a no claims history will also help to keep costs down. Insurers will look favourably on those who have not made a claim over a certain amount of time.
- It's important to recognise with insurance policies that cheapest isn't always best. You will get what you pay for and skimping on cover could leave you having to find thousands of pounds.
- What may cost a few pounds extra a month now could save you a huge amount in the future – so choose your policy carefully.