Insurance
Home Insurance
Home insurance is not required by law, but a mortgage lender will usually insist on buildings cover, and most people want to protect the things they own. Here is how the two main types work.
Key information
- Buildings cover protects the structure; contents cover protects your belongings
- Home insurance is not a legal requirement, though lenders usually require buildings cover
- Under-insuring can reduce what you are paid on a claim
- General insurance is normally protected at 90% by the FSCS if the insurer fails
On this page
Buildings and contents cover
Buildings insurance covers the permanent structure of your home — walls, roof, floors and usually fitted kitchens and bathrooms — against events such as fire, storm and flood. Contents insurance covers your possessions, from furniture to electronics, if they are damaged, destroyed or stolen.
You can buy the two separately or as a combined policy. If you rent, your landlord normally arranges buildings cover, but your own belongings are your responsibility, so contents insurance is worth considering.
Getting the sum insured right
The sum insured is the maximum your policy will pay out. For buildings it should reflect the cost of rebuilding your home, which is not the same as its market value. For contents it should reflect the cost of replacing your belongings. If you insure for too little, an insurer may reduce a payout proportionately, so it pays to review your figures regularly.
Exclusions and optional extras
Every policy has exclusions and conditions — for example limits on individual high-value items, or a requirement to keep the property secure. Optional extras such as accidental damage, legal expenses or cover for items you take outside the home can be added, usually for a higher premium. Read the policy summary so you know what is and is not covered before you need to claim.
Your rights & protection
- If your insurer fails, most home insurance is protected at 90% of the claim by the Financial Services Compensation Scheme, with no upper limit — this is different from the fixed cash limit that applies to bank deposits.
- You must take reasonable care to answer the insurer’s questions honestly and completely when taking out or renewing cover.
- You can complain to your insurer and, if not satisfied with its final response, refer the matter free of charge to the Financial Ombudsman Service.
General information, not personal advice
Consumer Credit is an independent information service. We do not provide regulated financial advice or sell financial products. For advice on your own situation, speak to an appropriately authorised firm or a free service such as MoneyHelper. About Consumer Credit.
Sources
We checked this page against these official and authoritative sources.
- FSCS, Insurance protection & compensation (opens in a new tab). Accessed 22 Aug 2026.
- MoneyHelper, Buildings and contents insurance (opens in a new tab). Accessed 22 Aug 2026.
- ABI, Home insurance (opens in a new tab). Accessed 22 Aug 2026.