Are you a property owner? The chances are that you have heard about buildings insurance. Like many landlords out there, you don’t know what it means or what it covers.
We have written this article to help you understand what the buildings insurance policy means and what it covers.
What is Buildings Insurance for Landlords?
Also known as landlord buildings insurance, it is a type of home insurance policy that covers the structure of the home. It is sometimes misunderstood to be contents insurance, but they are different. The two are the two (2) major types of home insurance policy.
With the buildings insurance policy, you will cover the structure of the home. Depending on the insurer, you may be able to cover the fixtures in the home. These fixtures include fitted kitchens, built-in wardrobes and bathroom suites.
What Does the Building Insurance Cover?
Buildings insurance typically covers damages caused by named perils, including aircraft collisions, vehicle collisions and fire.
The other coverage options of the buildings insurance policy are:
- Damages caused by fallen trees and satellite dishes.
- Attempted theft
- Burst pipes
- Natural disasters, including flood, hailstone and storm.
- Malicious damages, especially by a third-party.
Classifications of Landlord Building Insurance Coverage Options
The variety of coverages offered with the buildings insurance policy are divided into two (2). These are:
The standard buildings insurance policy covers the major or primary hazards or events. They include natural disasters like wildfire, storms, and earthquake. Burst and frozen pipes, vandalism, attempted theft and subsidence are also covered.
Add-ons to Building Insurance Policy
As the name suggests, the events, hazards or perils covered here are “added” to the main coverage. Examples of buildings insurance add-ons are:
- Provision of alternative accommodation if your home is being renovated or rebuilt.
- Coverage for outer buildings, sheds and garages.
- Swimming pools
What isn’t Covered with Buildings Insurance?
Although buildings insurance policy covers the structure of the home, some aspects aren’t covered. Typically, damages resulting from tear and wear in the home aren’t covered.
Note that the general exclusions tend to vary by the building’s insurance company. So, what Company A refused to cover may be covered by Company B.
With that being said, here are some of the exceptions to the buildings insurance policy:
Electrical and Mechanical Breakdown
Damages caused to your home because of mechanical and electrical breakdown aren’t covered. Examples are breakdown of your television set due to power surge or your refrigerator breaking down due to overuse.
Buildings Insurance Excess isn’t Covered
The policy has a limit to its coverage. In a case where you try to exceed the buildings insurance excess, the policy wouldn’t cover it.
You may be causing damages to your property without knowing it. This is called non-maintenance damage. Your buildings insurance typically doesn’t cover this type of damage, because it is more of an oversight.
An example of this type of damage is failing to fix your leaky roof and having it leaking when there is a storm. Another example is failing to replace your carpets when they wear thin.
Empty Properties aren’t Covered
When was the last time you stayed in your home? 30 days? 60 days? Typically, you need to get the buildings insurance for empty property. It is also called vacant property insurance.
This type of home insurance policy is used to cover homes or properties that haven’t been occupied for a while. Typically, insurers give a 30-day timeframe before the policy kicks in. your insurance company may also extend the coverage to 60 days from the last time the property was occupied.
The following aren’t also covered with the buildings insurance policy:
- Damages caused by insects, pests and birds.
- Leaking gutters
- Frost damage to the brickwork and outsider pipes. Frost damage is only covered if it is caused by a burst pipe.
Types of Buildings Insurance for Landlords
Landlords and property owners have two (2) options to choose from when purchasing buildings insurance policy.
Here are the common types of landlord buildings insurance you can get today:
This type of buildings insurance is used to calculate the buildings insurance premium based on the number of bedrooms.
We suggest getting it if you have more bedrooms in your home. The policy helps you get more payout when any of the named perils destroys or damages your property.
Many landlords prefer to go with the sum insured buildings insurance policy because it helps them keep track of the premiums.
So, what does the sum insured policy mean? It works by paying out the cost of repairing or rebuilding the home.
The amazing benefit of using the sum insured buildings insurance policy is that you only pay for the cover you need.
Factors that make up a Landlord Buildings Insurance Rebuild Value
Your buildings insurance provider wants to confirm some facts before issuing the policy. Some of the factors that make up the rebuild value or cost of rebuilding your damaged home include:
1. Listing Status of the Building
Is your home listed? Are you using it for Airbnb purposes? If so, the insurer will likely charge higher buildings insurance premiums because listed properties are expensive to insure.
2. Age of the Building
How old is your building? When was it constructed? Older properties are expensive to insure, but you can do something about it.
Find out the faults or repairs that need to be done. Change the old materials with new ones. That way, the insurer will be motivated to offer you lower rates on buildings insurance.
3. Size of the Building
The size of your home is valued by the number of doors and windows. Having more of those and more rooms can attract higher buildings insurance premiums.
Where is your home or property situated? Crime-prone areas are harder and more expensive to insure. Besides, living in a flood-prone is another risk that can impact your buildings insurance premium.
5. The Type of Building
What type of building do you have? Detached, semi-detached or terraced properties have different rebuilding costs.
In conclusion, the type of home, where it is located and previous claims history combine to influence the buildings insurance cost.
Can I Get Commercial Building Insurance?
Landlord building insurance is common for residential buildings. However, landlords can take out the commercial building insurance to protect a rented property.
Is Buildings Insurance for Unoccupied Property Available?
Your home insurer will only be able to cover the property for 30 to 60 consecutive days, being the unoccupancy period. After then, you may need to get vacant home insurance to protect the property.
How Long Does It take to Get Buildings Insurance?
You can get started immediately by comparing quotes from different buildings insurance providers.
Does Buildings Insurance Cover Roof Repairs?
Most buildings insurance policies only cover a part of the roof repair. The repair is subject to the fact that the cause of damage is written in the policy. An example of such damage is storm damage.
Conclusion: Buildings Insurance Covers Your Property’s Structure
You need the buildings insurance policy to cover the structure of your property and its fixtures against damages. Contact a reliable buildings insurance policy provider to evaluate your options.