Home Contents Insurance Vs Buildings Insurance: Why You Need Both

Buying a new home is the biggest purchase most people will make throughout their life, but sorting through all the paperwork can make the rewarding process of purchasing a home feel like a chore. When it comes to insurance, homeowners may find themselves overwhelmed and wondering what they really need from their cover.

This could explain why as many as 1 in 4 homes in the UK don’t have any form of home insurance, accounting for 6 million homes. But it doesn’t need to be overwhelming - buildings insurance and home contents insurance sound similar, but each form of protection covers different aspects of your home. Below, we explore what both of these types of insurance are and why you need them.

What is Buildings Insurance?

Buildings insurance covers the cost of repairing any damage to the physical structure of your property caused by anything from fires and storms to theft and vandalism. Walls, floors, roofs and even garages, fences and sheds are all structures covered by buildings insurance. The cost of replacing drains, pipes and cables is also covered. If anything were to happen to your home, your buildings insurance should cover the entire cost of rebuilding it, including demolition, site clearance and architect’s fees. It is usually required if you are purchasing a home with a mortgage.

What is Home Contents Insurance?

Home contents insurance protects your possessions within your property against damage or destruction. Furniture, decorative items and appliances are all counted as possessions. Some policies even cover items that have been taken out of the home, or on holiday. Home contents insurance is not commonly required when purchasing a home, but it comes in handy for instances such as theft, flooding or accidental damage.

What’s the Difference Between Building and Contents Insurance?

The difference in what is covered by either policy can be thought of as structures which are permanently fixed, and items which are able to be moved. This seems obvious enough, but when it comes to fixtures and fittings such as a fitted bathroom or a fitted kitchen, it can be harder to identify what falls under ‘buildings’ and what falls under ‘contents’. Generally, fitted rooms and laminate flooring would be covered by buildings insurance whereas carpets would be protected by contents insurance.

Most policies will carry an excess, which means you will foot the bill until a certain point – normally around £50 to £100. If you need to make a claim, some home contents insurance policies will pay the amount that your possessions are currently worth, however most have a ‘new for old’ cover which awards the full cost of stolen, damaged or lost items. Policies can vary on these points so be sure to pay attention to these details when researching what insurance is right for you.

Water damage is the most common home insurance claim, with 1.8 million paid out in the UK every day for ‘escape of water’ claims. In the case of a flood, having only one type of insurance would leave you liable for replacing the cost of the other, which can be eye-wateringly expensive. The average value of home contents is in excess of £35,000 whereas a combined contents and buildings insurance policy costs an average of £307 a year, or £6 per week.

Homeowners can shop around on comparison websites like Compare The Market, Go Compare or MoneySuperMarket. These websites use filters personalised to your needs, taking the stress out of searching for the perfect policy.

Do you think a combined cover is worth it? Join the conversation @MillerHomesUK on Facebook, Twitter and Instagram.