What Insurance Do You Need

When buying a home, your priority should be protecting the structure itself. That’s what Buildings Insurance is for.

Buildings Insurance covers the cost of repairing or rebuilding your home in case of damage. This could be caused by fire, floods, storms, subsidence or vandalism. Buildings Insurance will cover the structure of your home, including the walls, roof, windows, drains, pipes, cables, and outdoor structures like fences, garages, and sheds. Some Buildings Insurance will also cover fixtures and fittings too.

When choosing Buildings Insurance, you need to make sure you have adequate cover for the property you’re buying. You should also consider any other options or extras you might need, like accidental damage cover.

You need to have Buildings Insurance in place when you exchange contracts. At that point, you’re legally committed to buying the property. And if it becomes damaged from then on, you’ll likely be the one that has to foot the bill. So you must make sure you’re financially protected. Some mortgage lenders will also require you to have Buildings Insurance in place before they give final approval on your loan.

Whilst Buildings Insurance will cover the structure of your home, it’s vital that you protect your belongings too. Contents Insurance covers the cost of repairing or replacing your possessions in case they’re damaged or stolen. This includes your personal possessions, electronic items like TVs and computers, and white goods such as your fridge and cooker. But also furniture and furnishings, including curtains and carpets.

When buying a Contents Insurance policy, you should make a detailed inventory of all your belongings and estimate their value as accurately as you can, to ensure you opt for the right level of cover. Check that any policy you’re considering offers cover for specific valuable items, like electronics, jewellery or artwork.

You should buy Contents insurance when the sale is confirmed before you move any belongings into the property.

Mortgage Payment Protection Insurance (MPPI) can be a lifesaver if you unexpectedly face a situation where you can no longer afford your monthly mortgage payments. This might happen because you lose your job or can no longer work due to illness or an accident. MPPI acts as a safety net, and will pay your mortgage payments for you, typically for 12 to 24 months or until you return to work.

You can buy MMPI if you’re employed, self-employed, or are a contractor, although requirements will differ for each mortgage provider and for different policies.

You should arrange MPPI when you become the legal owner of the property (when the contracts are exchanged), as you’ll then be liable to begin repaying your mortgage.

You should consider Life Insurance when buying a home if you have dependents who wouldn’t be able to pay the mortgage themselves without you – such as your partner or children. Life Insurance typically pays out a lump sum amount on your passing that can be used to cover any debts you have and to provide funds for your loved ones to live off.

Life Insurance isn’t mandatory and won’t suit everyone’s circumstances. But if you have dependents, you should consider Life Insurance at the point you begin repaying your mortgage.

Home Emergency Insurance covers you for costs involved in urgent repairs and call-out services, including emergency repairs made to plumbing, heating and electrics. It gives you the peace of mind that if something unforeseen happens, you’ll have a number to call to get an expert to come and see it ASAP, without any eye-watering emergency charges.

Whilst some Buildings Insurance or Contents Insurance policies will offer this emergency cover, many policies don’t. Home Emergency Insurance can be vital backup insurance.

You should consider Home Emergency Insurance as soon as you become legally responsible for the property.

Another form of insurance you should consider when purchasing a property is Home Buyers’ Protection Insurance. It’s a form of insurance intended to cover you financially during the home buying process if the purchase falls through, such as if the seller pulls out or you’re gazumped.

Home Buyers’ Protection Insurance can reimburse you for money lost during the buying process, such as payments you make for conveyancing services, surveys, valuations or mortgage arrangement fees. Coverage typically lasts up to 120 days, although this will vary by policy.

Whilst not right for everyone, you should consider Home Buyers’ Protection Insurance within seven days of instructing your solicitor to represent you or after submitting your mortgage application.

No form of home insurance is legally required to buy or own a home in the UK. However, Buildings Insurance and Contents Insurance are advised as a minimum, and many mortgage providers will only grant a mortgage if you have Buildings Insurance.

Beyond Buildings Insurance and Contents Insurance, Mortgage Payment Protection Insurance, Life Insurance and Home Emergency Insurance are all sensible options to consider. Decide whether Home Buyers’ Protection Insurance is right for you to provide cover during the home buying process.

There’s a lot to think about when it comes to buying a home, but spending time to learn about and consider insurance is well worth it. As well as helping you better understand your home insurance options, we can help you find your ideal new house. Browse our new build homes for sale across the UK and get in touch with us to find out more.