Buildings Insurance

B uildings insurance covers the cost of rebuilding or repairing damage to your property, other than that arising through normal wear and tear. This includes permanent fixtures and fittings, such as built-in kitchen units, bathroom suites, toilets and built-in cupboards. Most policies will also cover any outbuildings, such as a garage, shed or greenhouse.

A good policy will insure your home against a range of risks, including;

  • Fire, smoke, lightning and explosions
  • Storm and flood damage
  • Burst pipes and other incidents of water leakage
  • Subsidence, heave or landslip
  • Vandalism or third party damage
  • Falling trees or branches
  • Theft or attempted theft
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Your buildings insurance policy needs to cover the amount it would cost to completely rebuild your home and it is vital that you get the figure right because the ‘sum insured’ is the maximum the policy will pay out. Also, if under insured a lower claim amount could be restricted on a pro-rata basis too. Remember – the rebuild cost is quite likely to be less than the current market value, so you could end up paying over the odds if you insure your home for the wrong amount.

Many insurers provide free online calculators to help you work out the rebuild cost of your home. The Association of British Insurers carries some useful information on its website, including an online calculator in association with the Building Cost Information Service (http://abi.bcis.co.uk). If you have just purchased your home the rebuild figure will, in most cases, be given on your Mortgage Valuation / Survey.

If your property has special features, such as a thatched roof, or is a listed building, it is recommended that you commission a surveyor from the Royal Institute of Chartered Surveyors (RICS) to assess the rebuild cost, although you will have to pay a fee.

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A number of insurers offer unlimited cover so you don’t have to work out the rebuild cost. However, if you know the figure it might be cheaper to find a policy that fits your exact needs. Some insurers also calculate the sum insured based on a simple assessment of where you live, the type and age of the property. But it is up you, the customer, to check the accuracy of the figures.

It is important to keep the sum insured up-to-date so that you are not left with a shortfall if you have to make a claim. Rebuild costs tend to rise over time; the rebuild value of your property might also increase if you make any changes, such as an extension or loft conversion. Some insurers offer policies that are index linked, so the sum insured automatically moves in line with rebuild costs.

Most insurers will also give you the option to arrange additional cover against one of more of the following:

  • Accidental Damage cover – the definition of accidental damage is pretty uniform across home insurance policies: damage that occurs suddenly as a result of an unexpected and non-deliberate external action. In layman’s terms, that usually means an unintentional one-off incident that harms your property. By way of an example, the damage caused by putting your foot through the loft floor or by putting a nail though a water pipe.
  • Legal Expenses cover – this covers the cost of legal proceedings if you need to bring action or defend a claim. It typically covers the legal expenses incurred in most personal injury, consumer, property and employment disputes.
  • Home Emergency cover – this covers the cost of emergency repairs which wouldn’t normally be covered by your home insurance. It ensures you can act quickly to do whatever is necessary to make your home safe and secure so that you can avoid further damage. Insurers generally cover the following; failure of or damage to plumbing and drainage, complete failure of the electricity supply within the home, failure of or damage to external locks, external doors or external windows and complete or partial breakdown of the central heating system.