What does home insurance cover?

03/04/2024

Your home is your most valuable possession, and also usually the most expensive. With the average UK property now valued at £282,000, many property owners will be keen to cover their home against potentially ruinous damage costs. By taking out a home insurance policy you can cover your physical property, personal items, fixtures and fittings, garden structures, pipes and more. The key is all in checking the policy details…

Home insurance what does it cover?

Home insurance can essentially be broken down into two types of coverage. Each insuring two different things.

Building insurance
Contents insurance

Whilst home insurance is generally used to refer to an insurance policy that covers the value of both your home and its contents – these two things are actually not the same. It is common for insurers to offer a ‘home insurance’ policy as a bundle of building and contents insurance in one easy-to-manage policy. Despite this however, the building and contents insurance which make up most home insurance policies are not the same thing and are essentially two different types of insurance.

1- Building insurance

Building insurance covers the actual structure of your property and the materials used to construct it. This means that your physical property, fixtures and fittings, walls, roofs, kitchen and bathroom appliances will all be covered unless explicitly stipulated otherwise. Outdoors, your building insurance policy will be able to cover you for any garages and sheds on your property. It can also cover you for drains and pipes which are legally regarded as your responsibility.

These will be covered by the following insurable events.

Natural disaster
Flood damage
Fire
Vandalism or malicious damages
Arson
Subsidence
Third-party damages
Falling objects

2- Contents insurance

Contents insurance will cover you for your home’s personal contents against the same risks mentioned above. Insurable contents are items typically found in the home such as furniture or permanent items at the property. Items typically covered under a contents insurance policy can include the following.

Sofas
TVs
Games consoles
Electronics
Beds
Clocks
Wardrobes
Cabinets
Jewellery

Whilst these are common items insured under UK home insurance policies, you can cover virtually any valuable possessions in your home with certain exclusions. You will typically not be able to cover pets, certain vehicles, weapons, artwork exceeding a certain value and gradual wear and tear of items under a contents policy. These will generally require their own individual insurance policies.

Remember – most home insurance policies will become invalidated if your property is unoccupied for more than 30 days.

What are home insurance add-ons?

Home insurance add-ons are additional coverage options which are not usually included as standard in a building or contents insurance policy. These extras can include the following.

Bicycle cover – A bicycle is a popular way of getting around town for the eco-conscious and those who just prefer not to drive. Since most bicycles will be kept in a shed or hallway when not in use, many providers offer the ability to cover your bicycle as an add-on under your home insurance policy.
Home emergency – Home emergency cover is designed to protect you against the unexpected such as broken heating systems, burst pipes and blockages. Emergency call-outs are typically more expensive than standard repairs, so home emergency cover can be worth it if your home is at risk.
Alternative accommodation – This can be covered under additional home emergency cover. If your home is damaged or rendered unlivable from an insurable event.
Legal cover – Property disputes with neighbours and other relevant third parties are a possibility for many property owners, and having legal coverage can protect you against the associated costs of hiring professionals to resolve potentially costly property disputes.

Which home insurance coverage do I need?

The type of coverage you decide to take out will depend on your needs and budget. Generally speaking, homeowners benefit the most from having combined building and contents coverage but even this can differ between policyholders. Landlords would be responsible for organising building insurance whilst renters may be required to take out contents insurance for their own belongings whilst occupying the property, this is sometimes called tenant’s insurance.

Many UK homeowners opt for some form of home insurance due to costly repair and rebuild charges, which often run in excess of hundreds of thousands of pounds.

Ultimately it is recommended that you have some form of home insurance policy in place to protect your property against potentially expensive and costly repairs. The average UK mortgage takes around 25 years for a borrower to pay off, this means that unfortunately few home owners have the ability to pay for rebuilds and repairs out of their own pockets.

What is not covered by home insurance?

Not every kind of damage or incident will be covered under your home insurance policy, regardless of whether you have building or contents cover. The most typical exclusion it wear and tear. This means that as your house ages, simple wear and tear caused by daily use or age will not be covered for replacement by your insurance.

Here is a more thorough breakdown of the typical exclusions to a home insurance policy.

Deliberate damage caused by occupant
Damage from pets
Wear and tear
Infestations
Boiler insurance

You should also check a potential insurance policy’s full details to confirm what will be excluded from your coverage.

Will home insurance cover my boiler?

Generally no, boiler insurance is a separate policy that will cover you against boiler repair and replacement costs and are separate from a general home insurance policy.

You can compare boiler insurance here

How much is home insurance?

The more comprehensive your home insurance policy, the more it will generally cost. Prices for a home insurance policy can range anywhere from tens of pounds to a couple of hundred pounds per year. It will really depend on the following factors.

The value of your property
The value of your contents
The likelihood of an insurable event in your area
The number of bedrooms in your home – more rooms generally mean higher insurance costs

The best way to ensure that you find the cheapest home insurance for your property is to compare multiple home insurance policies from different home insurance providers. This will give you the best chance of finding the cheapest home insurance for you.

How to get cheap home insurance

Whilst comparing multiple home insurance quotes is the easiest way of ensuring that you find the cheapest coverage for you – there are some additional and practical steps you can take to reduce the cost of your home insurance policy.

Invest in home security features – burglary alarm, smoke alarms, CCTV
Buy home and contents insurance as one bundle rather than as individual policies
Pay for your home insurance on an annual basis rather than monthly, this will reduce interest charges
Avoid add-ons that are not needed
Estimate your rebuild cost accurately

This article is intended as generic information only and is not intended to apply to anybody’s specific circumstances, demands or needs. The views expressed are not intended to provide any financial service or to give any recommendation or advice. Products and services are only mentioned for illustrative rather than promotional purposes