Building insurance can pay for the cost of repairing your house in case it was damaged or destroyed. If you are planning to buy your home through a mortgage, then you might not be able to do so if you don’t have building insurance.
What is building insurance?
With building insurance, you can be assured that the damages to your property can be repaired. This policy can also cover the repair of your fences, garages, and sheds. Additionally, it can also pay for the replacement of your cables, drains, and pipes.
Your insurance can fully cover the restoration of your house. It can even cover the demolition cost, architects’ fees, as well as site clearance. Buildings insurance can cover the repair cost of your property as long as the damage is caused by theft, fire, flood, storm, subsidence, and other devastating events.
Why should you get buildings insurance?
If you have a mortgage, then you are required to take out buildings insurance. This is one of the conditions on your mortgage. The amount of your coverage must be adequate enough to cover your outstanding mortgage. Some lenders will provide you a particular insurer, however, you are also permitted to select your own. Your lender might refuse your preferred insurer however, they can’t force you to use their own insurance policy except if it was bundled with your mortgage package.
If you are buying a house, then you should get buildings insurance. In the same way, if you are selling your house, then you should keep your policy until such time that the sale is over. Even if your house has been repossessed by your mortgage lender, you are still responsible for its insurance cover until it is sold. Be sure to inform your insurer that you do not live there anymore so your home can still be covered.
Nevertheless, even if you don’t have a mortgage, it is still recommended that you should take out buildings insurance. Although this is not compulsory, you have to consider if you can afford to pay for its repair cost in the event that it gets damaged or destroyed.
How much cover do you need for your buildings insurance?
Be sure that the amount of your coverage or the sum insured is sufficient enough to completely rebuild your property. Keep in mind that the cost of rebuilding your house is not equal to the amount that you’ve paid for your property or its present value. Typically, its rebuilding cost is less than the present market value of your home. Hence, you have to calculate it properly, so you won’t overvalue or undervalue the insured amount.
If you don’t want to compute the rebuild cost, then you can take out an unlimited cover which is often offered by some insurers. But it would be much cheaper if you take out a policy that suits your exact needs.
Some insurers will do a general assessment depending on the age and type of your property as well as its location. However, if this particular method is not suitable for your home, then you’ll have to determine the appropriate cover for your property.
Yet, it is also essential that you frequently evaluate the amount of your coverage since rebuild costs may increase anytime. Some insurers will automatically increase the sum insured every time the rebuild cost will increase. Also, you must consider that if you are making an improvement to your home such as having an extension, the rebuild cost will also increase.
Do you want to add some extras to your buildings insurance?
You can also choose to add some extras to your buildings insurance to cover other risks. Obviously, adding extra insurance also means that you have to pay higher premiums.
Accidental damage can cover your home in case there is unintentional damage to your ceilings, walls, doors, windows, and fixed glass.
Legal expenses insurance is another important coverage that can protect your family when litigations might occur. Damage to pipes, drains, boilers, and cables can cause inconvenience. At the same time, it is too expensive to repair. That is why it is worthwhile to include this cover in your policy. This can guarantee that the problem can be resolved immediately.
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