We all know things happen when you least expect it.
If you have a mortgage, your lender will insist your property is protected by buildings insurance. It usually pays out if your property is destroyed or damaged by fire, floods or subsidence (although you’d be required to check if you live on a flood plain for example). Damage to fixtures and fittings such as baths, kitchens, sheds, greenhouses or garages are often included too.
Your mortgage provider might offer you buildings insurance when you take out your mortgage, but you don’t have to take what’s on offer- and sometimes you can get better deals elsewhere. Use the key policy information to shop around and get the deal that works for you.
If you purchase a leasehold property (such as a flat in a block of flats) it’s possible the freeholder has arranged buildings insurance for the whole block, in which case it’s not needed.
What Isn’t Covered?
Your cover is based on how much it would cost to rebuild it. You can check whether you have enough buildings insurance through the Building Cost Information Service (BCIS) website. The online tool will help you calculate the sum you should insure your building for, in the event it has to be entirely rebuilt.
You’ll also need to tell your insurer if you extend your property. For example, if you wish to do a loft conversion or a conservatory. Your belongings are not covered by buildings insurance- these need to be covered by contents insurance.
Keeping Costs Down
As always, it’s best to shop around and see what deal is best. You may find a better deal if you buy building and contents insurance together. The majority of policies have a standard excess charge whereby you agree to pay the first part of any claim- such as the first £50 or £100. In some cases if you agree to pay a higher excess, you might get a cheaper policy. It’s always best to compare what’s covered in policies, not just the price- the key policy information will help you with this. Some might be cheaper than others, but you need to ask yourself- do you get the same level of protection?
Benefits can include:
Accidental Damage Cover
No Claims Discount
Loss of rent or costs for alternative accommodation