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First-Time Home-Buyer Insurance

Insuring your first home

Ashton Berkhauer
Written by  Ashton Berkhauer
5 min read
Updated: 04 Apr 2024

Have you saved money, found the right property, had the mortgage agreed, and have a hopeful exchange date on the calendar? If so, it could be the time to think about first-time home-buyer insurance. Here, MoneySuperMarket breaks down exactly what you need to know.

Understanding Home Insurance for First-Time Homeowners

For first-time homeowners, understanding the ins and outs of home insurance is essential. This type of insurance is split into two main parts: buildings insurance and contents insurance. Buildings insurance is there to protect the physical structure of your home, including walls, roofs, and windows. On the other hand, contents insurance covers movable items within the home, such as clothes, electronics, and furniture. It's important to note that policies can vary significantly between insurers, so always make a point to check the terms and conditions thoroughly.

Now you’re a homeowner…

If you've previously been renting, you may find that buildings insurance is a new addition to your list of responsibilities. As a tenant, the property itself would typically be covered by your landlord's insurance policy, leaving you with the need to only secure contents insurance for your personal belongings.

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Where should I buy first-time home-buyer insurance?

Gone are the days when you were required to buy buildings insurance directly from your mortgage lender. Now, as a homeowner, you have the freedom to shop around for both buildings and contents insurance. This is where the "home insurance channel" comes into play, offering a platform to compare different policies and find one that suits your needs and budget.

When should I buy home insurance?

Timing is everything when it comes to home insurance. You should have buildings insurance in place at the time of exchanging contracts with the property seller. As for contents insurance, it's wise to have it active from the moment you start moving your belongings into your new home. Remember, while most policies cover your belongings during transit, this is typically only the case if they are moved by a professional company and under certain conditions.

How much should I insure my home for?

Determining the right amount of coverage is crucial. For buildings insurance, you'll need to know the rebuild value of your home, which is the cost to rebuild the property from scratch in the event of total destruction. This figure is often different from the purchase price of your home, as it doesn't include the value of the land. When it comes to contents insurance, you should base the coverage on the replacement cost of each item, not its depreciated value.

What does home insurance cost?

The cost of contents insurance varies depending on factors such as your location and the total sum insured. Buildings insurance premiums are influenced by the rebuild value and potential flood risk associated with your property. There are several strategies to help reduce your insurance premiums, including bundling your buildings and contents policies, purchasing your policy online, opting to pay annually instead of monthly, and agreeing to a higher excess. For more tips on cutting costs, the article directs readers to a dedicated page for additional cost-saving advice.

When may first-time home-buyer insurance not protect you?

It's important to be aware that home insurance doesn't provide a safety net for every scenario. Some common exclusions you might encounter include:

  • Wear and tear: Insurance typically doesn't cover gradual damage such as damp or rust.

  • Accidental damage: For unexpected issues, you might need to add extra coverage.

  • Negligence: If you forget to lock your doors and an incident occurs, it's unlikely to be covered.

  • Pet damage: Many policies exclude damage caused by pets.

Do I need buildings insurance on a new build?

Even though new builds often come with a warranty, mortgage lenders usually require buildings insurance to be in place. Warranties cover specific issues but are not comprehensive, so having insurance is still recommended. Additionally, new builds may have unrecognized postcodes, which can require some coordination with builders to ensure that your new home is registered properly with insurers.

Compare first-time homebuyer insurance with MoneySuperMarket

As a first-time homeowner, it's essential to find a home insurance policy that provides the right level of protection at an affordable price. MoneySuperMarket is a valuable resource that allows you to compare home insurance policies quickly and easily. With the ability to find tailored quotes, you can ensure that you're not paying more than necessary for your coverage. Additionally, MoneySuperMarket offers a mortgage comparison tool, helping you to explore and compare mortgage deals that best fit your financial situation.

As you settle into your new role as a homeowner, feeling safe and secure in your investment is paramount. With the right home insurance policy, you can rest assured that both your property and possessions are protected. MoneySuperMarket stands ready to assist you in navigating the world of home insurance, offering the tools and information you need to make informed decisions. Embrace the joy of homeownership with confidence, knowing that you're well-prepared for the road ahead.

Please note that failure to keep up with mortgage repayments can result in the repossession of your home.

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