Buildings Insurance Cover
Building insurance is a mandatory requirement that all lenders look for when arranging a mortgage, regardless of whether you’re buying a property or remortgaging.
When purchasing a leasehold property this may already be covered by the monthly or annual maintenance charge. If you are purchasing a freehold property it’s likely that the buildings insurance will need to be covered by you and you will need buildings insurance in place for the exchange of contracts.
What does building insurance cover?
Building insurance covers the fabric and permanent fixtures of your home, such as: the roof, walls, ceilings, floors, doors and windows, fitted kitchens, built-in cupboards and bathroom suites. A standard buildings insurance policy should cover the full cost of repair or a full rebuild in case of: a fire, lightning strike, storm damage, gas explosion, falling trees, earthquake, vandalism, vehicle collisions with the building or bursting of the plumbing.
Contents Insurance Cover
Aside from building insurance it’s also important to ensure that the contents of your home is insured. Contents insurance isn’t compulsory, but it offers homeowners valuable protection for their belongings in the event that they were stolen or damaged.
What does contents insurance cover?
Contents insurance covers your possessions against loss or damage by theft or attempted theft, fire, explosion, lightning or earthquake. It will also insure against water leakage, storm or flood damage. The ‘contents’ of your home is defined by insurers as the sort of things you would take with you if you were to move to a new house, so it includes items such as furniture, clothes, electrical items, money and jewellery. Contents insurance may also cover some fixtures such as carpets and curtains.
When arranging contents insurance, you set the maximum level of cover the policy will pay out if, for example, the contents of your home are completely destroyed, so it is important to make sure you have the right level of protection. Many of us do get this figure wrong and experts estimate that one in five households could be underinsured because they do not know the true value of their home contents.
It can help to go through your home room by room and make an inventory of your possessions – they will probably add up to more than you think.
Don’t forget to include items that are in the loft or stored outside in the garden and shed.