Last updated: 4 November 2026. General information for the UK, not financial advice.
Home insurance is one of those bills that quietly renews every year. Most of us don’t read the policy until something goes wrong, and that’s exactly when you find out whether you’ve got the right cover.
This guide explains the difference between buildings and contents insurance, who needs what, what to check in the small print, and simple ways to pay less without leaving yourself under-insured.
The two main types of home insurance
| Type | What it covers | Who usually needs it |
|---|---|---|
| Buildings insurance | The structure of your home: walls, roof, floors, windows, and permanent fixtures like fitted kitchens and bathrooms | Homeowners. Usually a condition of your mortgage |
| Contents insurance | Your belongings: furniture, clothes, electronics, appliances, jewellery and other things you’d take with you if you moved | Homeowners and renters |
You can buy them separately or together as a combined policy, which is often (but not always) cheaper.
A simple test: imagine turning your home upside down. Anything that would fall out is usually contents. Anything that stays put is usually buildings.
Do I need home insurance?
- Homeowners with a mortgage: your lender will almost always require buildings insurance from the day you exchange contracts.
- Homeowners without a mortgage: buildings insurance isn’t a legal requirement, but rebuilding a home after a fire or flood could cost far more than most people could ever cover themselves.
- Renters: your landlord is responsible for buildings insurance. Your belongings aren’t covered by their policy, so you need your own contents insurance if you want them protected.
- Leaseholders in flats: buildings insurance is usually arranged by the freeholder or management company and paid through your service charge. You’ll still need your own contents cover.
What home insurance usually covers
Standard policies typically cover damage or loss caused by:
- Fire, smoke and explosion
- Storms and floods
- Escape of water (burst pipes, leaking appliances)
- Theft and attempted theft
- Subsidence, heave and landslip (buildings)
- Falling trees and aerials
- Vandalism
Many policies also include:
- Alternative accommodation if you can’t live in your home after an insured event
- Liability cover if someone is injured in your home or you damage someone else’s property
What’s often not covered (unless you add it)
- Accidental damage (spilling paint on the carpet, putting a foot through the ceiling, dropping your TV). Usually an optional extra
- Personal possessions away from home (phones, bikes, jewellery when you’re out). Often called “personal belongings” or “away from home” cover
- Wear and tear, gradual damage and poor maintenance
- Damage from pests like mice or moths
- Leaving your home unoccupied for longer than the policy allows (often 30 to 60 days)
- High-value items over the single-item limit unless you list them separately
- Running a business from home, or having lodgers, unless you tell your insurer
Always check the policy wording, because every insurer is different.
Key terms to understand
Excess: the amount you pay towards any claim. There’s often a compulsory excess set by the insurer and a voluntary excess you choose. A higher voluntary excess lowers your premium, but only choose an amount you could afford to pay.
Sum insured / rebuild cost: for buildings insurance, this is what it would cost to rebuild your home, not its market value. The rebuild cost can be higher or lower than the price you paid. Your mortgage valuation or survey may give a figure.
Single-item limit: the most the policy pays for any one item (for example £1,500). Anything worth more, like an engagement ring or expensive laptop, usually needs to be named on the policy.
New for old vs indemnity: “new for old” replaces items with new ones. “Indemnity” pays what the item was worth at the time, after wear and tear. New for old is more common for contents.
Under-insurance: if you insure your contents for less than they’re worth, your insurer may reduce any claim by the same proportion. So if you’re insured for half the true value, you might only get half of what you claim.
How much contents cover do I need?
It’s easy to underestimate. Go room by room and add up what it would cost to replace everything new: sofas, beds, clothes, kitchen equipment, electronics, toys, curtains, books. Many people are surprised by the total.
Some insurers offer unlimited contents or a set amount (for example £50,000) with a high-value item limit. Check the total and the single-item limit fit what you own.
10 ways to pay less on home insurance
- Don’t just auto-renew. Since January 2022, FCA rules mean your insurer can’t charge you more at renewal than it would charge a new customer for the same policy through the same channel. But other insurers may still be cheaper, so compare.
- Shop around 3 to 4 weeks before renewal. Prices are often lower when you buy a few weeks ahead rather than the day before.
- Use more than one comparison site, and check insurers that aren’t on them.
- Combine buildings and contents and compare it with separate policies.
- Raise your voluntary excess, but only to an amount you could actually pay.
- Pay annually if you can. Paying monthly often costs more because it can involve interest.
- Improve your security: good locks on doors and windows, and a burglar alarm, can reduce your premium. Check your insurer’s lock requirements, as the wrong locks can affect a claim.
- Don’t over-insure contents, but don’t under-insure either. Do the room-by-room check.
- Only add extras you need. Legal cover, home emergency and accidental damage can be useful, but check you don’t already have them elsewhere (for example, through a bank account).
- Check your rebuild cost isn’t higher than needed for buildings cover.
Haggle: when your renewal arrives, call your insurer with a cheaper quote and ask if they can do better. Be polite, have the quote in front of you, and be ready to switch if they say no.
Be honest on your application
Give accurate answers about your home, your claims history, who lives there and any security. If you give wrong information, even by accident, your insurer could reduce a claim or cancel your policy. Tell your insurer about changes during the year, such as building work, a lodger or working from home with stock or equipment.
How to make a claim
- Make your home safe and stop further damage if you can (turn off water, cover a broken window).
- Contact your insurer as soon as possible. Many have 24-hour claims lines.
- Take photos of the damage and keep damaged items if you can.
- Report thefts to the police and get a crime reference number.
- Keep receipts for any emergency repairs or costs.
If your claim is turned down and you disagree, complain to your insurer first. If you’re not happy with the final response, or after 8 weeks, you can take it to the Financial Ombudsman Service for free.
Special situations
- Flood risk: if your home is in a high flood risk area, the Flood Re scheme helps many households get affordable cover. Ask your insurer or broker.
- Students: check if your belongings are covered by your parents’ policy while you’re at university.
- Listed or unusual homes: you may need a specialist insurer.
Home insurance: people also ask
What’s the difference between buildings and contents insurance?
Buildings insurance covers the structure of your home and permanent fixtures. Contents insurance covers your belongings. Homeowners usually need both; renters usually just need contents.
Do renters need home insurance?
Your landlord insures the building, but not your belongings. Contents insurance protects your own things.
Is home insurance a legal requirement in the UK?
No, but if you have a mortgage, your lender will almost always require buildings insurance.
Is accidental damage cover worth it?
It can be if you have young children, pets or expensive items. It costs extra, so weigh the price against how likely you are to claim and your excess.
Why has my home insurance gone up?
Insurers consider claims costs, weather events, building costs and your own claims history. Always compare at renewal rather than auto-renewing.
Summary
- Buildings covers the structure; contents covers your belongings. Renters need contents only.
- Check the small print: excess, single-item limits, accidental damage and away-from-home cover.
- Insure for the right amount: rebuild cost for buildings, full replacement value for contents.
- Compare every year, pay annually if you can and improve security to pay less.
Next step: see how to cut your water bill, or cancel the subscriptions you don’t use.
General information only, not financial advice. Read your policy documents carefully.
Sources (checked 4 November 2026): FCA: home and motor insurance pricing rules · Financial Ombudsman Service: insurance complaints · MoneyHelper: home insurance · Flood Re