Unlike other types of insurance policies, home building insurance is rarely a voluntary undertaking.
Although not compulsory by law in the some countries, in most cases your home mortgage provider will insist that you take out a policy in exchange for their having provided you with the home mortgage. If you own a flat, your freeholder may well arrange the buildings insurance for you. And if you rent a home, either from a council or privately, buildings cover will be arranged by the owner. You will, of course, need to make independent arrangements to insure the contents of the property.
Home building insurance is the insurance which provides you with the protection against the cost of repairing/rebuilding the structure of your property in the event that something untoward should happen. Typically, your house is covered against a stated list of risks. These range from damage caused by flood, fire or subsidence to damage caused as a result of theft, by storms or maliciously.
As well as providing for problems with the structure of your home, buildings insurance gives cover for permanent fixtures and fittings such as baths, toilets and fitted kitchens. Policies usually include garages, garden sheds and greenhouses as well as boundary walls, fences, gates, paths, drives and an outdoor swimming pool.
Most policies pay for accidental damage to underground pipes and cables, glass in doors, windows, baths, basins and toilets. Cover may be extended to include damage caused by DIY mishaps, but the insurer may charge extra for this.
Amount of Cover
The 'sum insured' is the amount of money for which your home is covered and is the maximum an insurer will pay out even if your home is burnt to the ground. It is also the amount it would cost to rebuild your home although that's not the same as your home's market value, which could be greater or less. It is essential that you know just how much this sum needs to be to cover this. If in doubt, seek professional advice.
Some insurance companies offer unlimited cover. This means you don't have to worry about how much cover you need or whether it is adequate. Other insurers offer premiums based on a simple assessment of where you live and the type, age and size of your property. Premiums may be paid monthly or annually. If you are offered a monthly option, check whether the insurer charges extra for the privilege of spreading the payments.
An important area of home buildings insurance is that of subsidence.
If your home is an area prone to subsidence, the increased level of risk means that your premiums or excesses will be higher. However, even if your property has been affected by subsidence you should still be able to insure your property as long as any repair work has been carried out successfully by professionals.
You can minimise any risks in this area by:
- Contacting your buildings insurer at the first sign of any structural damage to your home – for example, if cracks wider than the edge of a coin appear in a wall. The quicker a problem is identified the easier it is remedied. If you do see any cracks appear, check them out but don’t panic. Most cracks turn out not to be evidence of subsidence and can be easily dealt with.
- If you are planting trees, find out their expected mature height then plant them at that distance from your house. A young Scots pine may be only one metre high in the local garden centre but in your garden it could grow to a over 30 metres.
- Don’t plant trees with a large spread of roots. These could undermine the foundations or infiltrate and damage drain runs.
- it is better not to remove established trees without consulting a specialist, especially in clay soil areas. The clay could swell and destabilise your home's foundations.
- Prune trees and shrubs to a sensible height. This reduces the risk of soil drying out and subsidence developing.
- Clear gutters regularly of leaves, dirt or rubbish and clear blocked drains immediately.
- Check pipes for leaks, especially during winter.
