Only if you are going to take out alternative cover!
It is very risky not having home building insurance. There are two main reasons. Firstly, if you have a mortgage you have to have it. Secondly, you will have to be pretty well off to be able to re-build the house in the event of a catastrophe. Don’t forget, nobody thinks it will happen to them.
What does buildings insurance cover?
So, what do you get for your hard earned cash? Hopefully, just piece of mind, and it is money down the drain. Most people aren’t sure what is covered by home buildings insurance and what is covered by home contents insurance. Here is a summary but remember, it varies with different insurers and it is wise to check with the insurer or better still use a broker who knows what he is talking about.
Home buildings insurance covers the main structure of your home, the garage, and outbuildings, (although sometimes only if they are listed in the deeds), for the cost of rebuilding. Usually so is everything else; walls, paths, drives, patios, terraces, fences, hedges, and gates – even tennis courts, swimming pools and ornamental ponds, but watch out for exclusions as they can be difficult to spot in the small print. Many people now have solar panels and wind turbines, they’re usually covered too, as are your fixtures and fittings. Inside the house a good rule of thumb is: If you turn the house upside down and it stays put, it’s covered under the home buildings insurance.
Other things to look out for:
Some providers need a re-build cost of the property, others use a notional cost of say between £300,000 – £500,000, which is usually adequate, and others use an unlimited amount. Don’t be fooled into thinking unlimited is best, that doesn’t mean they will give you a blank cheque!
- Some charge extra for monthly Direct Debit others don’t.
- You often will get up to £20,000 for alternative accommodation.
- You would usually get cover for fire, storm and flood damage.
- Cover for subsidence or heave of the land your property stands on. (Normally there is a £1,000 excess for this).
- You get a no claims discount, if you don’t claim. Always think carefully before making a small claim, after the excess and increased premiums the following year may cancel it out or even make you worse off.
- You can often get an additional discount on buildings and contents insurance if you buy them together.
- It also covers any permanent fixtures in your home like built-in wardrobes, kitchen surfaces, taps, basins, baths and showers.
- If your house was built before 1800, is not of “Standard construction” (i.e. brick walls and a tiled roof) or is listed then you will need special advice and insurers as normal insurers won’t touch them.
What causes the damage? You are usually covered for the following conditions:
- Fire, smoke, explosion, lightning or earthquake.
- Riots, civil commotion, labour and political disturbances or strikes.
- Malicious damage or vandalism.
- Storm or flood (If you have claimed for flood damage, don’t cancel, you may find it difficult to get covered again).
- Impact or collision.
- Escape of water or oil.
- Theft or attempted theft
If the property is going to be unoccupied for more than 30 days then check with your insurer as it increases their risk. Wet or Dry rot is not covered. Pollution from outside sources is unlikely to be covered. If you are doing structural work to your property then check the builder has insurance, your home building insurance will not cover you if the house collapses!