Why Should You Get Cheap Building Insurance and What Does it Cover?

Building insurance is mandatory if you are a homeowner. It is basically a pre-requirement before you can take out a mortgage and most lenders will insist on it. This is one of the ironic things about being a homeowner - until you don't pay off your mortgage, it is the lender and not you who owns the house, so you will pretty much have to agree to whatever terms they set, which almost always includes getting insurance.

Building insurance is basically designed to protect the lender or homeowner's interest should something happen to the building/house. This may be due to a natural calamity, or due to construction flaws. Since you and the lender are probably investing more than $100,000 into a house, it makes sense to get it insured.

But many cheap building insurance plans also cover things other than an outright building collapse or extreme damage. Even damage to internal fittings and fixtures can be covered. These may range from the kitchen sink to the bathtub to the interior decorations.

But how do you know exactly if you policy covers these fixtures too? Typically, most plans cover 'immovable' fixtures and fittings. Thus, if you can take out a fixture easily and carry it to a new home, it will not be covered (this would include small furniture, carpets, etc.). Since one can't reasonably remove a bathtub of cupboards from a house, these are usually covered.

You should also check whether the cheap building insurance policy you buy covers any extensions to your house, such as a greenhouse or a garage In some cases, it can also cover your garden, swimming pool, etc.

Besides being a requirement for most lenders, building insurance also makes a lot of sense as a homeowner. A house is a major investment, easily the biggest one you will make in your life. Protecting it against hazards such as fires, lightning, natural calamities, etc. is a must. Fixing a damaged house can burn a gigantic hole in your pocket, so it is best to get as much coverage as possible.

Moreover, since most policies also cover interior fixtures, you can save a ton of money on home repairs. Imagine coming home to find a leak in the bathtub that will cost $200 to repair. If you have a cheap building insurance policy, you will be able to recoup a major portion of the cost.