Home insurance – it might seem like a familiar enough subject and one that is typically straight forward. While that remains true, there are nevertheless different types of home insurance and it is imperative that you have the correct type for your particular property type.
Here we look at eight different types of home insurance that may be required to protect a residential property.
Probably the most familiar type of home insurance is the building and contents insurance arranged by owner-occupiers to protect the homes in which they live. That element of owner-occupation is critical to the type of insurance required.
Just as the title suggests, this comes in two parts – and may also be arranged as two separate insurance policies or as a combined policy:
- buildings insurance to protect the structure and fabric of the property; and
- contents insurance to protect the homeowner’s belongings and possessions in the home.
This type of home insurance also typically includes an element of property owner’s liability indemnity insurance to protect the homeowner against claims from neighbours, visitors or members of the public who have suffered an injury or had their property damaged through some contact with the insured home.
- Landlord insurance
Also known as buy to let insurance or let property insurance, this is cover designed to protect the property and the business run by a landlord from a home that is let to tenants.
Where standard home insurance is designed for owner-occupiers, landlords insurance is designed for property let to tenants. Indeed, the two are entirely distinct and are not interchangeable. If your property is let to tenants, you need landlord insurance – rather than standard home insurance – and any claim you submit may be rejected if you are trying to rely on standard home insurance while the property is let to tenants.
In addition to landlord liability indemnity insurance, landlord insurance also typically incorporates some degree of provision for loss of rental income in the event of an insured incident which leaves the property temporarily uninhabitable – and therefore unlettable – pending repairs and reinstatement.
- Holiday home insurance
A holiday home may be occupied by its owner or owners, but it might also be let to paying guests.
Part owner-occupied and part let to tenants, therefore, holiday home insurance needs to fill a role somewhere between both standard home building and contents insurance and landlord’s, or buy to let, insurance.
An article posted on the Independent Cottages website describes the law that applies to holiday homes and makes it clear that they are neither solely owner-occupied nor the type of property on long-term let to tenants (typically assured shorthold tenancies). There may also be relatively frequent and lengthy periods when a holiday home remains unoccupied by either its owners or tenants.
The elements of cover typically included in purpose-designed holiday home insurance include protection of the building, its contents, landlord liability indemnity insurance, and loss of rental income.
- Airbnb insurance
If you are a host for guests making use of the accommodation-sharing website Airbnb, at least part of your home may be occupied by short-term tenants.
Airbnb insurance is specially devised to provide the extent of home insurance (not met by the cover offered by Airbnb’s own promise to hosts) required when short-term tenants occupy your home.
- Unoccupied property insurance
Any home – whether normally owner-occupied, let to tenants, or a holiday home – that is left empty and unoccupied for longer than a month or so is likely to be treated as especially vulnerable to increased risks by insurers.
Any unoccupied property is at greater risk of loss or damage because of repairs or maintenance problems that develop into bigger emergencies because there was no one at home to report the problem or because empty property attracts intruders, squatters and even arsonists.
Because of those extra risks, insurers may severely restrict the nature and scope of cover offered so that specialist, standalone unoccupied property insurance is required to maintain adequate safeguards for the empty home.
- Park home insurance
A park home is a mobile home on a site specifically licensed by the local authority to allow owners and residents to occupy the accommodation throughout the year on a permanent basis (as distinct from a static caravan holiday home, which may be occupied for less than 12 months in any one year).
Specialist park home insurance recognises not only the use of the home as a permanent residence on a purpose-designed park but also the nature of construction of these manufactured homes.
- Non-standard home insurance
Similarly, there are other types of home built using non-standard construction methods – those using prefabricated concrete panels or steel-framed houses, for example, certain listed buildings and even cottages with thatched, rather than tiled or slated, roofs.
Specialist non-standard home insurance recognised the particular risks associated with such non-standard methods of construction.
- Home insurance during probate
While property remains subject to probate, ownership and control remains in the hands of the executors of the deceased person’s estate. The executors are also responsible for ensuring that any property included in the estate remains adequately protected by suitable insurance cover – in this case, specialist home insurance during probate.
There are also other variants of residential property insurance such as high net worth home insurance and lodger insurance. If you require any clarification on what type of home insurance you need, please do not hesitate to ‘phone us on 01325 346328 – one of our dedicated team will be delighted to help.