Is home insurance a legal requirement?

Whether you need to have home insurance depends on your circumstances – but even if it’s not mandatory, it may still be a wise move. Whether you’re a homeowner, tenant or landlord, get the lowdown with our guide.

Whether you need to have home insurance depends on your circumstances – but even if it’s not mandatory, it may still be a wise move. Whether you’re a homeowner, tenant or landlord, get the lowdown with our guide.

Rachel Lacey
Insurance and money expert
4
minute read
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Last Updated 26 SEPTEMBER 2022

Is home insurance mandatory?

Home insurance isn’t a legal requirement like car insurance, but if you don’t have cover in place for your home, you could leave yourself vulnerable.

According to the Association of British Insurers, insurance providers pay out an average of £8 million a day to reimburse homeowners for damage and loss.

If you’re buying a property with a mortgage, you may also find that your loan won’t be approved unless your bricks and mortar are insured.

What type of home insurance do I need? 

Home insurance protects both the building itself and the contents within it. What you need partly depends on whether you own or rent your home.

Buildings insurance is all about the bricks and mortar, and covers the structure of your property – including the walls, floors and roof – from unforeseen events like fire, floods and storms. It also covers the permanent fixtures of your home – fitted kitchens and bathroom suites, for example.

Contents insurance covers everything in your home that you can take with you if you were to move house – from your furniture to your TV and fridge. It usually includes carpets.

Home insurance can also offer handy add-ons at an extra cost, like cover for your personal possessions outside the home or accidental damage.

Do I need home insurance if I have a mortgage?

If you have a mortgage, your mortgage provider has likely made it a condition of the loan that you have buildings insurance in place. The provider has a sizeable financial stake in your home and wants to be confident there’ll be money available for repairs if disaster strikes.

But it’s your choice whether to get contents insurance. It can be tempting to save a bit of money, especially if you’ve just forked out a big deposit for a mortgage or spent a fortune redecorating. But ask yourself: could you really afford to replace your belongings if there was a break in, fire or flood?

I own my property outright. Do I still need home insurance?

If you own your home outright, there’s no obligation for you to take out either buildings or contents insurance. That said, your home and its contents are likely to be your family’s biggest asset and the decision to forgo home insurance could leave you financially exposed.

Even if you have the cash to replace a stolen laptop or item of jewellery, could you really afford to rebuild your home if there was a fire or flood?

I own and live in a leasehold flat. Do I have to buy home insurance?

You may well find that your freeholder is responsible for buildings insurance and that you pay your share of it as part of your service charge, rather than having to arrange it yourself.

It depends on the conditions of your lease, though, so you need to check. It could be that you insure the parts of the flat that are your legal responsibility and your leaseholder covers the communal parts of the building, like hallways and stairs.

However, your freeholder won’t be responsible for insuring the contents of your flat. Again, contents insurance isn’t mandatory, but you should seriously consider it to protect yourself against the loss of your possessions.

I’m a landlord. Do I need to take out home insurance? 

If you’re a landlord with a buy-to-let mortgage, your mortgage provider will probably insist you take out buildings insurance. You’ll want to consider a landlord home insurance policy because standard home insurance is unlikely to offer you the cover you need for a rental property. 

If you own the building outright, you’re not legally obliged to have buildings insurance, but not doing so will mean you’re liable for the full cost of any building repairs. 

And if you’re letting a furnished property, it may be a good idea to get contents cover for expensive items like beds, sofas and kitchen appliances. 

Many insurance providers offer landlord insurance, which can include buildings and contents cover. Compare landlord insurance with us to find the right deal for you. You can also add loss of rent insurance to cover your income if your property becomes uninhabitable because of fire or flood damage.

Do I need home insurance if I’m renting?

If you’re renting privately, it’s the landlord’s responsibility to insure the building. But you may want to take out your own contents insurance. Again, this isn’t compulsory. Be aware that if you choose not to take out contents cover, you’ll have to pay to replace your belongings if they’re damaged or stolen.

How much home insurance do I need? 

Whether you’re taking out buildings insurance, contents insurance or both, it’s important to get the right amount of cover. If you undervalue your home and possessions, you could end up under-insured, which may reduce your pay-out if you make a claim. On the other hand, you don’t want to pay for more insurance than you need.

Buildings insurance is based on the rebuild value of your home, not its market value. When you compare buildings insurance with us, you can use the Building Cost Information Service (BCIS) calculator to work out your home’s rebuild value. 

We can also help you estimate the value of your home contents.

How can I get a home insurance quote?

Whatever your situation, it makes sense to compare quotes for buildings and contents insurance. That’s where we come in. Start a quote with us today and we’ll help you find suitable home insurance at the right price for you.

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