Buildings Insurance

When you own a property, either outright or with a mortgage, buildings insurance provides you with financial protection should it be badly damaged or, in a worst-case scenario, destroyed. Think about what you would do if a fire broke out in your home or your tenants suddenly reported a burst pipe. With buildings insurance in place, you have a safety net to cover the costs of the damage.

At Trinity Finance, we’re here to guide you on the types of buildings insurance available and the amount of cover you need. Our mortgage and protection brokers can explain what is and isn’t covered under a policy and advise you of the optional items you can include if preferred. We can help with your insurance needs for a non-standard property, give you tips on how to lower your premiums and review an existing buildings insurance policy if you already have one.

What is buildings insurance?

Having buildings insurance in place ensures you’re covered for the cost of repairing or rebuilding your property when it’s been damaged or destroyed by manmade or natural disasters, such as fire, flooding, subsidence and vandalism. As well as the structure and fixtures of your property, this insurance can also cover outbuildings, garages and external items, such as drains, pipes, fences and cables, depending on your policy.

Types of buildings insurance

There are a few types of buildings insurance to choose from — sum insured, bedroom rated and unlimited sum insured.

Sum insured

The amount of cover you have with this type of policy depends on how much it would cost to rebuild your property from scratch. This is different from the market value and includes all of the rebuild costs, such as those for demolition, clearing the area and the services of an architect. If you underestimate this amount, you will be responsible for paying for the balance of the work needed. We’ll explain how to work out this figure later on in this guide.

Bedroom rated

For this type of policy, the amount you are covered for depends on the number of bedrooms in your property. You don’t need to work out the rebuild cost as the bedroom-rated amount is set by the insurer, which is much easier for you. However, the sum you’re covered for may be a lot higher than it would actually cost to rebuild your property as the insurer will protect you against being underinsured.

Unlimited sum insured

This type of buildings insurance policy doesn’t have a cap on how much you can claim. This gives you peace of mind that you’re not underinsured and means you don’t have to work out your property’s rebuild cost. Some insurers have claim amount limits for their standard policies so this is a good choice if the rebuild cost of your property is likely to exceed that limit. Premiums tend to be higher for this option.

What is covered with buildings insurance?

The structure of your property is covered by buildings insurance, which includes the roof, windows, ceilings, floors and walls. Fixtures are also covered, such as a fitted kitchen, bathroom suite, built-in wardrobes and doors. As mentioned earlier, it can also include structures that are outside your main building, such as your garage, driveway and greenhouse.

Whilst each insurer and policy is different, buildings insurance generally covers damage caused by:

• Fire
• Flooding, storms and other natural disasters
• Frozen, burst or leaking pipes
• Explosions
• Fallen trees
• Subsidence
• Vandalism and theft
• Vehicle collisions

Some insurers include repairs to central heating systems and plumbing issues in their standard buildings insurance cover. If this isn’t included in your policy, you can usually include this as an optional add-on.

What’s not covered with buildings insurance?

A standard policy won’t normally cover you for:

• Wear and tear
• Damage caused as a result of neglect or poor workmanship
• Accidental damage
• Damage caused by pests
• Frost damage (with the exception of a burst pipe)
• Storm damage to fences and gates
• Leaving your property unoccupied for a specific period

The property fittings and your personal contents are also not covered by buildings insurance. You’ll need to take out a separate contents insurance policy for this type of cover or a combined home insurance policy.

Optional add-ons to your buildings insurance

If you’d like extra cover to that offered by a standard policy, you can opt for some add-ons. These can include accidental damage cover, home emergency cover and legal services cover.

Accidental damage cover

Accidents happen and accidental damage cover provides financial protection for unintentional damage caused to your property’s structure or the fixtures. For example, you might drill through a pipe by mistake, damage a kitchen unit, smash a window or knock a hole in a wall.

Home emergency cover

Be financially covered in an emergency when you add home emergency cover to your policy. This covers you for unexpected problems, such as faulty electrics, broken door and window locks, issues with drainage or plumbing, a faulty central heating system and roofing issues. The costs of an emergency call-out for a tradesman along with the repair charges are covered as well as the cost of overnight accommodation if you’re unable to stay in your property.

Legal services cover

This enables you to get legal advice, take advantage of legal services and benefit from the payment of any legal costs that need to be covered. It provides cover for all manner of issues, ranging from a boundary dispute with your neighbour to a compensation claim from someone who has been injured while on your property. It also covers you for issues that aren’t related to your property, such as employment disputes, and provides cover for your loved ones as well as you.

Our mortgage and protection advisers, located throughout Kent, London and Edinburgh, are ready to help you decide exactly the right level of cover needed for your buildings insurance. They make the process straightforward and ensure your policy is tailored to precisely meet your protection requirements. To find out more about the insurance options available to you and to put cover in place quickly, just give us a call on 01322 907 000. If it’s out of office hours, send an email to us at info@trinityfinance.co.uk or an enquiry via our contact form and we will reply to you with further details of how to financially protect your property.

Do you need buildings insurance?

Buildings insurance isn’t a legal requirement but having this cover in place will be stipulated by your lender if you’re taking out a mortgage. This has to be arranged before the contracts can be exchanged. Even if you don’t have a mortgage, buildings insurance provides considerable financial protection should the worst happen to your property. It’s even more recommended if your property is in a high-risk area, such as one prone to flooding or with a high level of crime.

If you’re a landlord, buildings insurance can cover the costs of any repairs that are needed to your investment property. If you own a leasehold property, you need to check your position with regard to buildings insurance. Usually, the freeholder is responsible for this so there’s no need for you to have a separate policy but be certain of this first. The freeholder may also have taken out buildings insurance but passed the cost onto you via your service charge.

How to decide the value of your buildings insurance cover

The amount of cover you have with your buildings insurance needs to be sufficient enough to pay the rebuild costs of your property. Should the worst happen and your property is destroyed, all materials, labour costs and professional fees need to be covered by your insurance. As mentioned earlier, the rebuild cost isn’t the same as the market value, which is how much your property is worth on the open market. The market value includes the value of the land your property has been built on as well as allowing for the property’s location, local amenities and other factors. The rebuild cost, therefore, is usually lower than this. So how exactly can you work out how much it would cost to rebuild your property from scratch?

The rebuild value

This is determined by numerous factors, as detailed below.

• The size of your property. This matters because the larger it is, the more it will cost to rebuild.
• The type of property you have. For example, a detached, semi-detached or terraced house.
• The age of your property. This is important because the materials used to build older properties tend to be more expensive.
• The building materials used. These can significantly affect the rebuild value and a non-standard construction will increase the rebuild costs.
• Whether it’s a listed property. This is more than likely going to be more expensive to rebuild.

It’s a good idea to ask a chartered surveyor to estimate the rebuild value for you. This helps to ensure that you’re not either underestimating or overestimating the amount that you need to be insured for.

How much does buildings insurance cost?

As well as the rebuild value, other elements affect the cost of your buildings insurance policy. The location of your property, for example, is important. If it’s situated in a high-risk area, such as one with a high crime rate or one that’s prone to flooding, it has increased risk for the insurer because you’re more likely to claim. This, in turn, can increase your premiums.

The level of cover provided by your policy also determines how much your premiums are. You may be happy with standard cover but, on the other hand, you may prefer the peace of mind that some add-ons provide despite the higher cost. An index-linked policy is worth considering as it increases over time in line with inflation to ensure that any increases in the rebuild costs are allowed for. If you’ve made previous claims on a buildings insurance policy, your premiums may increase.

Benefit from lower buildings insurance premiums

There are various ways to keep the costs of your premiums down. One example is to install forms of security in your property, such as a surveillance camera or a burglar alarm system, helping to reduce the level of risk. Another way is to pay for your policy annually rather than monthly. If you choose the latter option, you end up paying interest on your monthly premiums, making your overall cost much more expensive.

You can also benefit from lower premiums if you agree to pay a higher excess. Whenever you make a claim, you have to pay the compulsory excess. However, before taking out your policy, you can also agree to a voluntary excess amount. This has to be paid along with the compulsory excess in the event of a claim but you can normally benefit from having lower premiums. Generally, the higher the excess you agree to pay, the more you can expect the premiums to come down.

Also, try to keep your no claims discount (NCD) intact and refrain from making a claim. That way, the insurer is more likely to look favourably on you and reduce your premiums when your policy is due for renewal. Another way to save money is to consider combining your buildings insurance with contents insurance. This is usually cheaper than taking out two separate policies.

When your policy is about to expire, get in touch with one of our mortgage and protection advisers rather than allowing it to auto-renew. They can review your circumstances and shop around for more competitive buildings insurance cover for you, helping you to save money on your premiums.

Buildings insurance for non-standard properties

If your property has a non-standard construction, such as being built with a timber frame or having a thatched roof, the premiums for your buildings insurance are likely to be higher. This is because it will probably be more expensive to rebuild than a property made with brick walls and a tile roof, for example. A listed property is also classed as non-standard. In some cases, a specialist home insurance policy may be needed instead of standard buildings insurance.

Other considerations when choosing your buildings insurance

All buildings insurance policies are different and it’s important to check the aspects that are included. As well as confirming what’s covered with a standard policy and the add-ons you can choose from, think about what other features may be beneficial to you in the future. For example, if you use a tradesman recommended by the insurer to carry out repairs on your property, is a guarantee on their work offered? Do you have access to a 24-hour emergency helpline? Are you covered for replacement locks and keys should yours be stolen or lost? Check how much the compulsory excess is and if the insurer includes the entitlement to a no claims discount within their policy terms.

Alternative accommodation

Be sure to check that alternative accommodation is allowed for in your policy. If your property is uninhabitable while repairs are being carried out following an incident, you’ll need somewhere else to stay. An alternative accommodation feature means the insurer will cover the cost of temporary accommodation until the works have been completed. There tends to be a limit on the amount for this so double-check what the figure is. This cover doesn’t just apply to a property you live in. If you’re a landlord, the insurer will pay for alternative accommodation for your tenants or pay you for the lost rent.

An unoccupied property

Your buildings insurance policy may not be valid if you leave your property unoccupied for an extended length of time. This is usually considered to be over 30 consecutive days. It’s important to let your insurer know if this is likely to happen as there may be restrictions on your cover or you may need to take out an unoccupied home insurance policy.

Review your buildings insurance policy

As the cost to rebuild your property will go up over time, you should review the amount of cover you have before renewing your policy. That way, you can be certain you’re not underinsured and won’t have to pay for any of the costs should the worst happen to your property. Your insurer may automatically increase your cover via an index-linked policy to allow for this so be sure to check whether or not this is the case.

You also need to review your policy if you make any changes to your property, such as converting the loft or adding an extension. Home improvements are likely to increase the rebuild costs of your property so you should make sure your cover amount reflects these changes. It’s actually best to notify your insurer before you start carrying out any works so that you don’t risk invalidating your policy.

Protect your home with buildings insurance

You’ve spent a lot of time and money on your home so it makes sense to financially protect it in case it’s damaged or, even worse, destroyed. At Trinity Finance, we help you put the right amount of cover in place at an affordable price so you can rest assured your home is properly insured against an unexpected event.

Our mortgage and protection consultants – located throughout Kent, London and Edinburgh – can guide you on how to shape your buildings insurance policy. You don’t need to worry about working out the rebuild cost of your property yourself as they can help to determine this after asking you a few simple questions. They will advise you on the policy inclusions, make sure you’re aware of the exclusions and help you to decide if you need any extra cover, such as accidental damage or home emergency cover.

Just give us a call on 01322 907 000 to discuss your insurance needs and benefit from a tailored service no matter how complicated your requirements. You may, for example, have a portfolio of properties as a landlord and need insurance for multiple properties. We can search for the best insurance solution to ensure the right cover is in place for you.

You can also contact us by email at info@trinityfinance.co.uk or via our contact form and one of our protection advisers will reply to you as quickly as possible. As well as buildings insurance, we can arrange your contents insurance so that your property is fully covered.