Home Insurance

Building Insurance Explained

Protect your investment in property and mitigate potential risks.

  • By Paddy Compare
  • 03 July 2023

Buying property is a big investment with several risks attached to it - one of them being the risk associated with unforeseeable events such as robbery, vandalism, fire, flooding, or storms.

When buying property, it is important to safeguard it by taking measures like buying home insurance. Building insurance specifically, is a type of insurance that offers financial protection for the structure of your home.

There are 5 types of home insurance:

  1. Home contents insurance
  2. Building insurance
  3. Building and contents insurance
  4. Holiday home insurance
  5. Unoccupied home insurance

Paddy Compare connects you with reliable building insurance brokers who will offer you a policy plan which is well-suited to your requirements.

In this article

What is building insurance?

Building Insurance is an insurance policy that provides financial protection for residential or commercial buildings. It covers the cost of repairing or rebuilding the insured property in the event of damage or destruction caused by specified perils.

What does buildings insurance cover?

The exact coverage you can get varies, but most building insurance policies cover:

  • The structure of the building itself
  • The walls
  • The roof
  • The floors
  • The windows
  • Other permanent fixtures
  • Additional structures such as garages or sheds

The perils covered by building insurance commonly include:

  • Fire and smoke damage
  • Storm damage (including wind, hail, or lightning)
  • Water damage from burst pipes or flooding
  • Theft or vandalism
  • Explosion
  • Impact damage from vehicles or falling objects

Building insurance policies may also include liability coverage, which protects the property owner in case someone is injured on the premises and seeks compensation.

What's not covered in building insurance?

Building insurance typically does not cover:

  • General wear and tear
  • Maintenance issues
  • Earthquakes and floods
  • Acts of war or terrorism
  • Intentional damage by the policyholder
  • High-risk activities such as a home-based business involving hazardous materials
  • Storm damage to fences, gates, or hedges

As you learn about building Insurance coverage, it's essential to have a basic understanding of what does home insurance typically covers.

Who needs building insurance?

Building insurance is useful for:

  • Owners of a house or condominium.
  • Those with a mortgage.
  • Those who own a rental property.
  • Those who lease out their property to tenants.
  • Those who own commercial property.
  • Property investors.

To break it down for you, Building Insurance is a must-have for:

  1. Homeowners
  2. Renters
  3. Landlords

Here's why!

Not sure if this type of insurance policy suits your needs? Understand which type of home insurance policy is best for you as a homeowner and then make an informed choice!

What's the difference between building and content insurance?

Key differences between buildings insurance and contents insurance include:

Buildings Insurance Contents Insurance
Covers the physical structure of your property, including the walls, roof, floors, windows, doors, and other permanent fixtures. Covers household belongings inside your property such as furniture, appliances, electronics, clothing, jewellery, and other valuable items.
Protects against damage to the building caused by specified perils such as fire, storms, vandalism, or water damage. Provides coverage against theft, fire, vandalism, and other covered perils that may damage or destroy your belongings.
Typically includes coverage for the rebuilding or repair costs of the structure if it is damaged or destroyed. Provides coverage for the replacement or repair costs of your possessions.
Essential for homeowners and property owners to protect their investment in the building itself. Essential for both homeowners and tenants who need to safeguard their valuable belongings.

How much does building insurance cost?

The cost of building insurance premiums is determined by factors such as:

  • The value of the property
  • The rebuild cost
  • Its location
  • The security measures in place
  • Your claims history
  • The construction materials used
  • The level of coverage required
  • The deductible amount
  • Additional coverage

Apart from the above listed, there are a few crucial factors that define the coverage and cost of a Home Insurance policy on a general basis.

How is the rebuild value calculated?

The building rebuild value is the estimated cost to rebuild your property from scratch if it were to be completely destroyed. Identifying your rebuild value is required to ensure that your building insurance coverage adequately reflects the cost of rebuilding.

Key factors considered when calculating the building rebuild value:

  • The overall size and dimensions of the property.
  • The construction materials used in the building.
  • The presence of any internal features.
  • Special features such as historical significance or architectural complexities.
  • Local labour and construction costs.

In addition to this, here are a few tips to get cheaper Home insurance in Ireland to reduce your policy cost.

Planning on buying building insurance?

It's recommended to carefully review and understand the terms, coverage limits, and exclusions of a building insurance policy before purchasing it to ensure that it meets your specific needs and provides adequate protection for your property. With Paddy Compare, you can take help from expert insurance advisors who will carefully assess your property and insurance requirements and connect you with the most suitable building insurance providers.


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