Buying a newly built property is exciting. Everything is pristine — the fitted kitchen and bathroom suite have never been used, there’s no need to decorate and, more importantly, you’ll be the first person to live there. Once your purchase has completed, you simply collect the keys, move your belongings in and make it your home. All that’s left to do is to ensure that your investment is protected with new build home insurance.
At Trinity Finance, we can assist you with all aspects of the home-buying process, from arranging your mortgage to putting financial protection in place. Our mortgage and protection advisers are here to provide impartial advice on how to safeguard your home. They can help you decide on the right level of cover before arranging your affordable new build home insurance policy.
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What is new build home insurance?
When buying a new build, you can rest assured that no one has ever owned or lived in it before. It will more than likely have been built within the last 2 years and you may even have bought it off-plan. This means that you found it through a developer or a builder and the property hasn’t been fully built yet. As such, you may encounter snagging issues after you’ve moved in, such as problems with the fittings or a construction defect. For this reason, new builds fall under a more specialised insurance category.
Your newly built home should come with a warranty that’s valid for 10 years. However, that won’t protect you against unexpected incidents that are out of your control. This is where new build home insurance comes in. You can benefit from financial protection against unexpected damage to the building, including its structure and fixtures. The damage could be caused by a fire or flood, for example. This cover is provided by the buildings insurance aspect of your new build home insurance policy. You can also be financially protected for loss or damage to your belongings under the contents insurance aspect. We’ll explain both of these cover types in more detail below.
The cover provided by a new build warranty
The majority of new properties built are done so by companies that are members of the National House-Building Council (NHBC). The 10-year warranty mentioned above is provided by the NHBC and is called a Buildmark warranty. This warranty provides you with the following cover:
- During the first 2 years: Any defects with your home’s construction, including the fixtures and fittings, must be dealt with. These issues can include doors that don’t open and close properly, windows that leak when it rains, loose bathroom tiles or guttering problems, for example.
- The remaining 8 years: Structural issues caused by the original construction work are covered. This includes problems with the floors, ceilings, walls, staircases and roof.
- From exchange of contracts: This is when the warranty takes effect. If the builder suddenly goes bankrupt and the construction of your property hasn’t been completed, you are covered by the warranty.
What is covered with new build home insurance?
Whilst the NHBC Buildmark warranty covers you for defects resulting from poor workmanship, it doesn’t provide financial protection for unexpected incidents, such as fire, flooding or theft. To ensure your home is fully protected, you need new build home insurance. The two main components of home insurance for a new build are buildings and contents insurance. These policies can be taken out separately depending on your needs but it’s usually more cost-effective to combine them.
Buildings insurance
This covers your property’s structure and fixtures, such as the fitted kitchen and bathroom suite. With buildings insurance, you’re financially protected against the cost of repairing damage to your home or its rebuild cost. The damage may be caused by fire, flooding, storms, explosions, frozen or burst pipes, subsidence, fallen trees, vehicle collisions, vandalism and theft. Depending on the insurer, structures that are outside your home may also be covered, such as your garage, greenhouse and driveway. When using a mortgage to buy your home, the lender will usually insist that you have buildings insurance in place before you exchange contracts.
Contents insurance
This covers your possessions should they be stolen, lost or damaged by fire, flooding, subsidence or other unexpected incidents. You may not think contents insurance is a priority when you have so many other expenses to pay. However, have a look around at everything you own and think about whether you could afford to replace your belongings in a worst-case scenario. Anything that you can physically remove from the property is covered, such as your furniture, soft furnishings, clothing, gadgets, appliances, jewellery and other valuables, kitchenware, freezer contents, sports equipment and floor coverings as well as your garden furniture and equipment.
Add-ons for your new build home insurance
Optional extras are available when considering home insurance on a new build. These include accidental damage cover, personal possessions cover, legal expenses cover and home emergency cover, to name just a few. The add-ons available depend on your insurer. Our mortgage and protection brokers will ensure you’re aware of all of the add-ons available so that you can tailor-make your new build home insurance to meet your needs.
- Accidental damage cover: If you accidentally break a window or spill something on a carpet, for example, this covers you for the costs.
- Personal possessions cover: This covers the possessions that you take with you when you leave your home, such as your phone, watch, handbag, jewellery and laptop.
- Legal expenses cover: This covers legal services and costs relating to property disputes as well as problems outside of your home, such as employment issues.
- Home emergency cover: With this inclusion to your policy, you are provided with emergency assistance. The costs of an emergency call-out for a tradesman as well as the repair charges are covered. The cost of overnight accommodation is also covered if you’re unable to stay in your home while the repairs are being carried out.
Get expert guidance on shaping your new build home insurance policy
Our mortgage and protection advisers, based in Kent, London and Edinburgh, are here to help you decide on the right level of cover needed for your new home. They can advise you on how to work out the value of both your buildings and contents insurance cover and ensure you’re aware of the policy inclusions and exclusions. Your new build home insurance policy will be tailor-made to meet your protection needs, including any extra add-ons you require.
To discuss the options available to you in more detail, just give us a call on 01322 907 000. We’ll find the best new build home insurance for your requirements, giving you peace of mind that your home is financially protected. If it’s out of office hours, send us an email at info@trinityfinance.co.uk or an enquiry via our contact form. We will reply to you with further information on how to financially protect your home and its contents.
How much does new build home insurance cost?
The cost of your new build home insurance cover depends on a few factors. The first is whether you take out both buildings and contents insurance. The second is whether you opt for any additional cover. Thirdly, the rebuild value of your home affects the cost, which we’ll detail below.
The rebuild value
If the worst happened and your home was destroyed, the rebuild value is how much the insurer would need to pay out for it to be rebuilt. This amount would have to cover all of the materials, professional fees and labour costs involved. The rebuild value of your home is not the same as its market value. The latter includes the cost of building your home and the value of the land it has been built on as well as allowing for your home’s location, the local amenities and other factors. Therefore, the rebuild cost should be lower than the market value. It is usually based on:
- The size of your property
- The type of property you have
- The age of your property
- The building materials used
- Whether it’s a listed property
- Whether it’s at risk of subsidence
- If it’s located in an area with a high crime rate
- If it’s located in an area that’s prone to flooding
Whilst you don’t want to overestimate the rebuild value of your home, it’s important not to underestimate it too. Ask a chartered surveyor to provide you with an estimate for the rebuild value so that your home is insured for the correct amount.
Benefit from cheaper premiums
There are a few ways to gain from cheaper premiums when getting home insurance on a new build.
- Take out a combined policy: As mentioned earlier, it’s usually cheaper to have combined buildings and contents insurance cover rather than paying for two separate policies.
- Pay annually: If you choose to pay monthly premiums, you will have to pay interest on them. By paying annually, you save on the interest charges.
- Protect your no claims discount (NCD): The longer you refrain from making a claim, the more favourably the insurer will look on you and they will likely offer you a discount on your premiums.
- Pay a higher voluntary excess: Compulsory excess is payable whenever you make a claim but you can also pay a voluntary excess amount in addition to this. Usually, the higher the amount you agree to pay for your voluntary excess, the cheaper your premiums will be.
- Don’t auto-renew: Rather than allowing your new build home insurance to automatically renew, contact our protection brokers before your cover expires. They will check your circumstances and search for more competitive deals to help you to save money on your premiums.
Safeguard your home with new build home insurance
Your new home awaits you so make sure it’s financially protected, both outside and inside, with new build home insurance. At Trinity Finance, we help you ascertain the right amount of cover needed should your home and possessions become damaged or even destroyed in an unexpected event.
Our mortgage and protection brokers – located throughout Kent, London and Edinburgh – can guide you on your property’s rebuild value and how to work out the value of your belongings. They will explain the different types of cover available for both the buildings and contents aspects of your insurance. They will also help you to decide if any extra cover is needed, such as personal possessions or legal expenses cover.
Simply give us a call on 01322 907 000 to benefit from the best home insurance for new builds at an affordable price. If you prefer, send your details to us by email at info@trinityfinance.co.uk or via our contact form. One of our protection consultants will reply to you as quickly as possible with more information. As well as new build home insurance, we offer a range of mortgage and protection services that provide financial protection for you and your loved ones.
FAQs
What are the benefits of buying a newly built home?
During the buying process, you don’t need to worry about being gazumped and there’s no risk of being held up in a property chain. If you’re buying your home off-plan, the builder or developer may let you have a say in certain aspects of its design, such as whether you have a colour preference for the units in the kitchen. Another advantage of buying off-plan is that you may start to build up equity immediately if the property is located in an area that’s benefitting from rising house prices.
When you move into your new home, everything is brand new. This means there’s no wear and tear and, unless there are a few snagging issues, you can move straight in and settle without having to redecorate or deal with any repairs. You can also benefit from cheaper bills as new builds are usually designed to be energy efficient. As well as that, your home will have various safety aspects, such as an alarm, security lighting and adequate locks. These safety features should help to keep your new build home insurance premiums lower.
Some government-backed schemes also provide help when you buy a newly built property.
Is it cheaper to insure a new build rather than an older property?
Home insurance for new builds is generally cheaper than for older properties. This is predominantly because of the safety features, which help prevent burglaries. The building materials used tend to be more readily available, helping to keep the premiums lower.
Modern construction techniques are used and the property’s plumbing, wiring and roof are all new. These factors ensure there’s less likelihood of a claim being made. If something does go wrong, it’s usually cheaper to pay for repairs in a new build compared with the cost of repairs needed in an older home. Again, this helps to keep the insurance premiums for new builds lower than those for older properties.
What do you do if there isn’t an NHBC certificate?
The property you wish to buy may not have been built by a company registered with the National House-Building Council (NHBC). This means you won’t be provided with a Buildmark warranty. If there are any defects in your home’s construction and you don’t have a warranty, you’re not covered. Before proceeding with your purchase, you should ask the builder why they aren’t a member of the NHBC. This can help you to decide whether or not to go ahead with buying the property. It may be just that they are a small building company and the fees are too expensive for them, for example.
Without a warranty, though, you are vulnerable in the event that any construction flaws are discovered. You won’t have any recourse against the building firm and no financial protection in place to cover the repair costs. It’s recommended, therefore, to buy a home that’s covered by a warranty. As mentioned earlier, it’s still important to arrange new build home insurance to cover you against unexpected damage to your home and belongings.
What happens if your postcode isn’t recognised?
You may find that your postcode isn’t recognised by an insurer. This is because a new address for your home has to be created by the local authority. It’s the responsibility of the builder or developer to arrange this. Once this has been done, it’s then registered with Royal Mail. If an insurance provider hasn’t updated their system, the new postcode won’t show up on it. If this happens, they won’t be able to provide you with an accurate insurance quote.
To ensure your postcode is registered, contact Royal Mail or the building firm. Our mortgage and protection brokers will approach insurers that regularly update their systems and are, therefore, more likely to have a record of your address.