New Build Home Insurance
If you’ve just purchased or moved into a new build home, you’ll want to get insurance to protect the property both as an asset and the roof over your head. Most new build homes will have a 10-year warranty, the Buildmark Certificate, offered through the National House Building Council (NHBC). This warranty will only cover you for work specifically carried out by the developer, or structural damage related to it, and you’ll still need to obtain a separate buildings insurance policy to protect yourself from damage caused by fire, floods, or natural disasters. In fact, your mortgage lender may insist on it.
In this guide:
- What is the NHBC Buildmark Certificate?
- How much cover do Buildmark Certificates provide?
- Do I need additional insurance for my new build home?
- What happens if insurers don’t recognise the postcode for my new build?
Most new build homes are covered by the Buildmark Certificate, a 10-year warranty for new homes and new conversions. The warranty is offered through the National House-Building Council (NHBC) and comes into effect when you exchange contracts on your new build home, including the time before the home is completed.
You may also be able to obtain a Buildmark Certificate for newly converted properties, although these warranties will often come with some exclusions as specified on the insurance certificate.
Buildmark Certificates are attached to properties rather than their owners, so if you purchase a home that was built just a few years ago, it will likely have a Buildmark warranty in force. The policy documents for it should be handed over to you at the time of the completion of the sale.
Around 20% of builders don’t register with the NHBC, so there’s no guarantee you’ll receive a Buildmark Certificate with your new home or conversion.
With a Buildmark Certificate, for the first two years following the exchange of contract, you’re covered by a Builder Warranty. If you encounter issues with your home due to incorrect or incomplete work during this period, the builder is required to fix them for free. This cover excludes issues emerging from general wear and tear or from lack of maintenance
For the next eight years of the warranty - years 3 through 10 - the structures of the property, including roofs, floors, walls, windows, and doors, are protected against problems emerging from the building work. It will also cover the possibility that your home was built on contaminated land and/or wasn’t constructed to Building Regulations.
The most Buildmark warranties will pay out is the original purchase price of the property, up to a maximum of:
- £1 million for a new build home, or £25 million for all homes in a continuous structure, such as a block of flats
- £500,000 for new conversations, or £5 million for homes in a continuous converted structure
These maximums increase 5% each year, to account for inflation.
The NHBC warranty only covers issues in the home’s structure related to the building work. It won’t protect the structure of your property against damage caused by natural disasters, fires, crime, and other mishaps. You’ll need to take out an additional buildings insurance policy to protect yourself from those eventualities. Many mortgage lenders will require you have buildings insurance as a condition of the loan.
As Buildmark Certificates apply only to the structure of the property, you’ll need to get a contents insurance policy to protect the personal possessions you store in the property.
When you compare home insurance policies, you’ll be asked for the postcode of your home. Insurers charge more to insure the structure and contents of properties in high crime neighbourhoods or areas prone to flooding. If you’ve recently purchased a new build property, its address may not be in the databases insurers use to assess the risk of insuring a property and you may struggle to obtain a quote for insurance. Your builder or developer is responsible for contacting your local authority’s planning and building department and registering a new address, which will then be added to insurers’ databases. You can check directly with the developer or with Royal Mail to ensure this has been done.
When searching for new build home insurance, you may need to find an insurer which has recently updated its database and recognises your address.