Household Buildings insurance
House insurance, also know as buildings
insurance, is basically designed to cover the bricks and mortar
ie: the fabric of your home against the insured risk happening.
The best example of this is a fire. If a fire rips through your
home then, subject to you being insured, you would make a claim
on the insurance and the Insurance Company would pay to put the
property back in the condition it was prior to the incident.
It is important to note that you should always ensure that you
have adequate cover for the rebuild value of the house. Failure
to do this can result in any claim not being met.
It is a common misconception that the property is insured its
market value. This is incorrect, the reason for this is the
insurance needs to cover the cost of reinstatement ie to
re-build the property, as such this figure can wildly differ
from the actual properties value.
2 Bed Mid Terrace North of England market value approx £35,000
However this property could easily cost £70,000 to £80,000 to
5 Bed Detached Property south of England open market value circa
This property could easily have a re-build value of only
What these two examples demonstrate is, the open market value of
a property bears no relation to the re-build value, please
remember this when calculating your insurance because for the
reasons above this could invalidate your cover altogether.
Finally the risks covered. It is always important to check what
cover you buildings insurance gives you especially when you are
in a high risk area.
A topical example of this is if you live in an area that is
prone to flooding you should make sure that your policy gives
you that valuable coverage. However don't get your hopes up if
you are in a high risk area it is likely that the insurer will
be aware and cover could be restricted.
Do not be tempted to keep information like this secret from the
Insurance company as this is classed as non-disclosure and can
invalidate your insurance cover altogether. This can also be
said for information disclosed on your survey report if you are
aware of information from your surveyor that could affect the
integrity of the property it is important to tell the insurer
because again if they find out that you knew and you failed to
disclose you might not be insured at all.