Do I need home insurance?

Home insurance isn't just a box to tick off; it's a comprehensive safety net that protects your property and possessions from unforeseen events. 

A property, whether your first, second or buy-to-let is most likely one of the most significant investments you'll make in your lifetime. For buyers, sellers, and landlords alike, safeguarding this investment is not just prudent; it's essential.  

Let's delve into why home insurance is a cornerstone of property ownership and management. 

Do I legally need to have home insurance?

While home insurance isn't legally mandated, most mortgage lenders will require you to have it in place as a condition of the mortgage, so it could be risky to view it as an optional extra. According to the Association of British Insurers, property insurers paid out an eye-watering £4.86 billion to homeowners and businesses in 2023, with over half of this figure – £2.55 billion – going towards home insurance claims. This marked a near 10% increase from 2022's totals and was driven largely by weather-related damage.*

These figures aren't just numbers; they represent peace of mind for thousands who could otherwise have faced financial difficulties. With the average home insurance claim rising to £6,235 in 2023, an 11% increase from the previous year, it's clear that the cost of not having insurance can be far more than the premiums paid.*

For buyers: securing your dream home

For those purchasing a home, especially with a mortgage, home insurance is often a lender's requirement. But beyond satisfying your mortgage provider, buildings insurance protects the structure of your property against disasters. Without a policy, you could be left vulnerable to the full cost of repairs or rebuilding after events like floods or fires, which tend to be the most costly.

Contents insurance, while not required by lenders, is equally important, covering everything from furniture to personal items. 

For sellers: protecting your asset

For sellers, too, it's important to ensure the property you’re selling is protected. Until the moment you hand over the keys, any damage to the property or its contents could delay or derail the sale, potentially leading to significant financial losses. With the value of theft claims up by 15% and non-weather-related water damage up by 20%, the risk is real and rising.*

For landlords: safeguarding your investment

Landlords face unique risks, from property damage by tenants to prolonged periods of no occupancy. Landlord insurance is tailored to these challenges, and while it's not legally binding, it's a critical component of a robust investment strategy. Data shows that weather-related claims affected homeowners and businesses alike, with business claims amounting to £443 million in 2023, underscoring the vulnerability of properties to the elements.*
 

What about non-standard properties?

For those with non-standard properties, such as thatched houses or listed buildings, specialist insurance is key. The same goes for holiday homes or properties at risk of subsidence, where standard policies may not provide adequate cover. If this is you, we recommend talking to an insurance specialist who can offer you a more personalised choice of products.

Moreover, consider optional extras like accidental damage, home emergency cover, personal possessions cover, and legal expenses cover. While these come at an added cost, they can provide invaluable protection for specific risks and could save you money and hassle in the long run.

How do I choose the right cover?

When selecting home insurance, balance is key. Over-insuring means paying for cover you don't need, while under-insuring could leave you exposed. Our unlimited rebuild cost guarantees that you will never be underinsured, and our blanket sum insured of £75,000 on contents helps too. Our team can help arrange the appropriate insurance for you by taking you through the cover options we have, allowing you to tailor a policy to your needs.

Top tip: Ask if the insurance provider offers an automatic increase in insurance before Christmas, as some providers, like AXA, increase a customer's cover 30 days before and 30 days after Christmas, as standard.**

Correct at the time of publishing – 03/12/2024

Sources:
*Weather damage insurance claims worst on record
**AXA Festive Home Insurance

Countrywide Mortgage Services is a trading name of Countrywide Principal Services Ltd which is authorised and regulated by the Financial Conduct Authority (Firm Registration Number 301684). Registered Office: Witan Gate House, 500–600 Witan Gate West, Milton Keynes, MK9 1GF. Registered in England no. 01707341. MS/CW/7833/12.24