What does buildings insurance cover? + Other FAQs

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When you buy a house, you will usually need to arrange buildings insurance and if your property is mortgaged, this type of cover is usually mandatory with most lenders.

Buildings insurance: What is it and what does it cover?

A buildings insurance policy will provide cover for the cost of repairing or rebuilding your property, should it be damaged or destroyed as a result of:

  • Fire, smoke, explosions or earthquakes
  • Fallen trees, lamp posts, satellite dishes or aerials
  • Theft, attempted theft, malicious damage/vandalism
  • Vehicle or aircraft collisions
  • Subsidence (repairs only)
  • Storm and flood damage

But of course, the exact circumstances in which you are and aren't covered for will be clearly stated in the policy's terms and conditions.

You might be interested to read: What is the average cost of home insurance?

Who needs buildings cover?

It is predominantly homeowners and landlords that require buildings insurance and if you take out a mortgage, a lender will require this to be in place before the exchange of contracts.

If you rent a property, it is usually the landlord’s responsibility to arrange and pay for buildings insurance, but a tenant will need to arrange their own contents insurance.

What is not covered by buildings insurance?

Most standard policies do not provide cover for the general wear and tear of a property and will not usually cover the following:

  • A leaking roof through general wear and tear (unless the cause was as a result of external damage from, say, a storm)
  • Damp caused by gradual deterioration of the property
  • Subsidence of driveways, patios, walls or swimming pools
  • Underpinning - this is seen as a preventative measure for subsidence and is not usually covered by a standard policy so check the smallprint
  • Frost damage to outside brickwork or pipes
  • Storm damage to fences, gates and plants
  • Damage deliberately caused by you or someone living with you
  • Damage caused by animals or pests
  • A property left empty for a long period of time, typically 30 days or more

Different types of buildings insurance

Different types of buildings insurance can include:

  • Landlord buildings insurance: buildings cover specifically for landlords renting out a property as standard insurance doesn’t usually cover tenant-occupied properties. If the property is mortgaged, a landlord will usually be required by their mortgage lender to take out specific landlord’s insurance for a rental property.
  • Holiday home insurance or unoccupied home insurance: a niche type of insurance specifically covering holiday properties rented to third parties or your own home if it’s left unoccupied for up to 60 days. Most standard insurance policies do not provide cover for homes left vacant for long periods of time.
  • Subsidence insurance: if your property has historic subsidence, landslip or heave issues, then you may need to seek a specialist insurer to provide insurance as you may struggle to get a standard policy with most mainstream insurers.
  • Listed buildings insurance: in addition to standard cover, this type of insurance can provide cover for the cost of using specific original materials or graded building experts. Additionally, some policies can include accommodation cover if you need to move out whilst your property is restored or rebuilt.
  • Sum insured: this means your insurance policy is based on the amount it would cost to completely rebuild your home from the ground up (from scratch), including all related professional fees. These are typically index-linked policies.
  • Bedroom rated: this means your insurance policy is based on the cost of rebuilding your home according to the number of bedrooms it has.

How to get the best buildings insurance deal

To get the best building insurance deal for you, your property and your circumstances, you should:

  • Shop around and compare quotes on comparison sites and directly with insurers not on comparison sites.
  • Make sure you have the correct type of policy and cover as some standard policies will not cover all types of properties and circumstances.
  • Read the smallprint - boring and tedious as it may seem, you must read the terms and conditions of any policy as there may be some sneaky exclusions that means your cover is worthless.

You might like: What’s the difference between building and contents insurance?

Does buildings insurance cover accidental damage?

No, most standard policies do not include accidental damage cover or if they do, it’s extremely basic; this is usually a paid for ‘add-on’ to a policy.

What if my home is unoccupied?

If you leave your home unoccupied for 30 consecutive days or more without telling your insurer, then your policy could be invalidated.

If you plan to leave your property unoccupied for more than 30 days on the trot then you should always notify your insurer and arrange unoccupied house insurance.

Do I need buildings insurance for a flat?

Leaseholders who do not own the freehold to their property do not usually need buildings insurance as landlords typically arrange and pay for this.

Should you purchase a flat and your conveyancer identifies an issue with the landlord's buildings cover, you may need to take out contingent buildings indemnity insurance to fully protect you.

How much buildings insurance do I need?

You should make sure your buildings insurance covers the amount it would cost to rebuild your home from scratch. This isn’t the same price as you paid for the property or how much it’s worth; the rebuild cost is usually less because it doesn’t include the value of the land it’s built on.

When you take out a mortgage to purchase a property, the lender’s surveyor will produce a valuation that usually stipulates the rebuild cost.

If you’re a cash buyer, you can follow the Building Cost Information Service’s advice to estimate the rebuild value or alternatively, employ the services of a surveyor.

Do I need buildings insurance when exchanging contracts?

Yes, especially if you’re borrowing money to buy a property. Nearly all mortgage lenders will specifically state in the terms and conditions of their mortgage offer that a buyer must have buildings insurance in place on the day contracts are exchanged.

If you’re a cash buyer, having buildings insurance in place is not a legal requirement but is sensible in the albeit unlikely event that the house is destroyed between exchange and completion.

For more information, check out our guide: Short-term buildings insurance between exchange and completion.

How do I make a claim on my buildings insurance policy?

  • If the damage caused to your property was due to criminal activity (i.e. arson), first and foremost contact the police and make a note of the crime reference number they will provide you with.
  • Call your insurer as soon as possible to notify them. Their claims line should be detailed in your policy documentation or just search for your insurer’s name and claims telephone number online, although you will usually need your policy number to hand.
  • If any contents are damaged, do not be tempted to dispose of any items unless your insurer specifically says you’re able to. 
  • Again, however tempting it is to remedy the damage caused to your property, you should avoid doing anything to improve its appearance until the damage has been fully assessed (i.e. do not decorate or remove carpets). 
  • Take photographs of the damage caused to your property and, if applicable, the contents. 
  • Make detailed notes of any damage to the building or its contents.
  • Dig out any receipts or invoices to provide evidence of purchases and if you cannot provide receipts, instead provide bank or credit card statements.
  • Your insurer will probably ask you to obtain estimates for repair works from tradespeople but if the damage is substantial, they may arrange for a loss adjuster to assess the damage to clarify what repairs are required and value the claim.
  • Do not arrange any repair works unless or before your insurer has agreed to this.

Will I receive a payout?

Yes, if your claim fully complies with the terms and conditions of your insurance policy, but no, not usually if:

  • Your property was left unoccupied for more than 30 consecutive days;
  • The damage was caused by general ‘wear and tear’;
  • The damage was deliberately caused by you or someone living with you.

See ‘What is not covered by buildings insurance’ above for more reasons why you may have a claim refused.

If you feel a claim has been unfairly rejected, complain to your insurer and if the matter remains unsatisfactorily resolved, you can escalate your complaint to the Financial Ombudsman Service.

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