New build home insurance
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When you buy a new build home, you should have some form of protection in place through the National House Building Council (NHBC) Buildmark guarantee warranty. Any complaints or disputes you may have regarding your new home can also be resolved by the New Homes Ombudsman Service.
However, these services don't cover everything, so it's always worth considering home insurance to ensure you're financially protected should anything happen.
What is classed as a new build?
A property is typically classed as a 'new build' if it has never been lived in before or it has been recently constructed or substantially renovated. There's also the two-year rule that many mortgage lenders and warranty providers agree on in terms of what defines a new-build property.
Housing developments and property developers may be authorised to sell new-build properties before they're completed. These properties generally benefit from energy-efficient features and can be cheaper to insure and run.
Do I need home insurance for a new build?
Like any property you own, having home insurance in place isn't always a legal requirement, but it can help protect anything that isn't already covered under a warranty. If you have a mortgage, some lenders may include a requirement for you to have buildings insurance in place as part of your agreement, for example.
In buying a new build, you'll receive some peace of mind with the NHBC warranty in place. But crucially, it generally only covers structural defects and poor workmanship, so anything that the builder or developer isn't responsible for won't be covered.
What does new build home insurance cover?
Home insurance is useful in that it can help plug the gaps in the NHBC warranty and cover both your property and contents.
| Home insurance typically covers: | Common exclusions: |
|---|---|
| Weather, fire and flood damage | Wear and tear |
| Burglary and theft | Negligence and lack of maintenance |
| Vandalism | Faulty property design |
| Falling objects (such as trees, aerials and lampposts) | Unoccupied properties (typically those left for more than 30 days) |
| Subsidence | Damage caused by pets |
Exactly what is and isn't covered by your policy will largely depend on your policy and home insurance provider, as it can vary. There are some elements of home insurance cover that may be included as standard or offered as an optional extra, such as accidental damage.
You'll also have single-item and total cover limits inserted into your home insurance policy. That's why it's important to consider what cover you need before comparing quotes.
When should I start my new build insurance?
Buying a property is complicated, especially with a number of dates marking the exchanging of contracts, completion date and move-in date. The day you exchange contracts is when you're legally responsible for the building.
So, if you're buying home insurance, it's important to align this with your policy start date. If your property is still being built when you exchange contracts, the developer usually covers the structure until completion, but you must check your contract.
NHBC warranty vs home insurance: What's the difference?
The key difference between the NHBC warranty and home insurance is what they can offer cover for. There's little overlap, so we'll break down the two products:
NHBC warranty
Buildmark is a warranty offered to owners of brand-new or newly converted properties if the developer specifically purchased and registered the property with the NHBC.
It's valid for up to 10 years following completion, but what's included in the warranty changes after the initial 2 years.
Warranty (Years 0–2): The builder of your property is responsible for fixing and repairing any issues that fail to meet NHBC requirements during this time. This can include any snags or defects in workmanship and materials.
If you do experience any problems during this time, contact the builder as soon as possible. It's important to log any interactions and keep a record of your communications with the builder. If the builder does not reply or dismisses the warranty, you should contact NHBC.
Warranty (Years 3–10): After the initial 2 years of the warranty, the builder is no longer directly responsible. Instead, the NHBC insurance policy kicks in for the remainder of the 10-year term to protect you against major structural failures.
If you need to make a claim, the NHBC will assess the damage and decide whether to instruct a payout for repairs.
Home insurance
While the NHBC warranty protects your property from structural issues and defects, home insurance covers external events affecting your home and belongings.
You can buy policies that strictly look after your building or its contents, or a combined policy that covers both.
Buildings insurance protects the shell of your home. This relates to the structure of your property—providing cover for the walls, roof, and permanent fixtures (such as a fitted kitchen).
Contents insurance can cover the cost of replacing or repairing items if they're damaged or stolen. This could include gadgets, clothing, moveable furniture and more.
A standard home insurance policy can help ensure you have financial protection against damage caused by fire, flooding, theft, vandalism, and subsidence.
This type of damage can be unexpected and doesn't usually relate to the standard to which your property was built. This is why home insurance can offer cover for these situations, whereas an NHBC warranty can't.
How can I get cheaper home insurance for my new build?
The good news is that generally newer homes are cheaper to insure compared to older properties. This is largely down to the modern materials that they're built with, posing a lower risk in the eyes of insurers.
Better security, up-to-date wiring, and energy-efficient features also help reduce the cost of home insurance for new build properties.
But there are other ways that can help you lower your home insurance premiums, including:
- Accurately estimating your property's rebuild cost
When you're searching for home insurance quotes, you'll typically be asked to provide the rebuild cost of your home.
This refers to the cost of completely rebuilding your property in the event your current home is destroyed. It's not the market value of your home.
- Paying for home insurance annually instead of monthly
Parting with a lump sum to pay for your home insurance up front can actually work out cheaper than paying monthly instalments.
This is because insurers charge interest if you decide to spread payments over 12 months. So, paying up front is cheaper over the course of the policy if you can afford to do so.
- Invest in security features
Implementing new insurance-approved locks, CCTV & video doorbells and monitored alarms can help reduce what you pay.
Security features may deter thieves and help lower the risk of your home being burgled in the eyes of insurers. Fortunately, if you buy a new-build home, you may already have some security equipment fitted.
- Shopping around and comparing quotes
Using price comparison websites, like Uswitch, can help you find home insurance quotes from a variety of leading insurers.
This can ensure you find the policy right for you! So it's always worth shopping around before automatically renewing with your existing provider.
Advantages and disadvantages of buying a new build
When you're weighing up your options between properties old and new, there are quite a few differences to look out for. You may not realise it, but it can have a big impact in terms of maintaining your home and buying home insurance.
So, what are the advantages and disadvantages of buying a new build?
| Advantages | Disadvantages |
|---|---|
| Most new builds comply with the latest building regulations and enjoy high energy efficiency – helping reduce your bills. | New build homes are highly sought after, and it's reflected in the price. The moment you move in, the property is no longer 'brand new' and its value is likely to fall initially. |
| If you buy a new-build home from a property developer, you won't be involved 'in a chain'. This can speed up the home-buying process. | Snags and imperfections can appear early on, especially if the property is built against a tight deadline. |
| You may be able to select elements of your home before buying. It'll also be a blank canvas of sorts, allowing you to decorate to your taste from the get-go. | It's not uncommon for property developers to maximise profits by building several homes using a smaller space. As a result, you might find new-build homes to be less spacious in terms of room size and garden space. |
| The 10-year NHBC Buildmark warranty can offer you protection from structural defects and snags. | If you've signed up to buy a home in a new development, there's a chance the property won't be built by the stated completion date. |
| Buying from a property developer may provide you with incentives and other benefits. They may offer to pay for your stamp duty or upgrade certain features of the property. |
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