Insurance policies for first-time buyers

Insurance policies for first-time buyers

Author Aira Torralba

When you’re buying a house the costs do mount up. So, which insurance policies are really important and which ones are just a ‘nice to have’?

Some might say that’s a trick question. (Sorry about that) We think it’s more than just 'nice to have’, we think it’s essential to have insurance that protects your belongings and everyone you care about. We also know there’ll only be so many things you can afford when you buy your first home.

So, although we can’t tell you which policy is the most important (everyone’s priorities are different), this bite-sized guide should help you get started.

Home insurance

The first insurance that springs to mind when buying your first home is home insurance of course, but what do you need?

What does it cover?

Broadly there are two types of home insurance, buildings cover and contents cover. The easy way to explain what they cover is to say, if you tipped your home upside down and shook it, everything that falls out would be the contents. Things like furniture, clothes, electrical appliances and everything that’s left including bricks, roofing tiles, fitted kitchens, bathroom fittings would be covered under buildings insurance.

When you buy your first home, your mortgage provider will want to make sure that you have buildings cover to protect the loan they’ve given you, should the worst happen. You’ll need to have buildings cover that includes the rebuilding of your home and any fixtures and fittings -this will usually be less than the actual market value of your home. Take a look at our step-by step guide for more information on the process of buying your first home.

What do you need to think about?

When thinking about how much contents cover you need, you’ll need to consider the cost of replacing all your things and it can soon add up. In fact the government’s Money Advice Service cites the average homes as having contents worth around £45,000. If you buy Aviva buildings and contents insurance online you won’t need to calculate what you need. We’ll give you up to £50,000 to cover content and we’ll cover the cost of your building for you as standard, leaving you one less thing to think about. You can find out more about Aviva's buildings and contents insurance here.

Life insurance

Think about how your family would cope financially if you weren’t around any more. Would they be able to afford the mortgage payments on top of their day-to-day living expenses? If not, they might have to leave their home. Life insurance can help to protect against this risk and it could be cheaper than you think.

What does life insurance cover?

Whilst different providers may offer different features and additional benefits, the common feature of life insurance is that it pays out a lump sum if you die within its policy term. This could provide your family with a financial safety net. It could help to pay off the mortgage straight away, giving them security in their home without the need to worry about making repayments. You’ll probably find that mortgage providers or brokers ask you about life insurance for this very reason.

How much cover do I need?

You should think about how much cover you need. Do you just need to cover the mortgage, or would your family need more support? It’s important that you think about how much you can afford to pay, so that the policy can stay in place for as long as you need it. Our life insurance calculator can help you get an idea of how much cover you need.

Home emergency cover

First house, first home, and possibly the first time you’ve been totally responsible – financially – for any and everything that goes wrong. That’s one of the reasons for being so careful you when you’re looking for a home. Try our House Viewing Checklist, if you’ve not used it before.

Being without heating or hot water isn’t much fun, especially in the depths of winter, and if your boiler breaks down it can be costly to get fixed. Home emergency cover is designed to cover you in these situations. There are lots of different policies out there that will cover you in all sorts of emergency from your boiler breaking down to rat infestations.

In general, what does boiler insurance cover?

Boiler cover helps pay for the unexpected expenses of gas boiler breakdowns. Some policies also cover other types of boilers. If your home doesn’t have a boiler, then it’s pretty safe to say you don't need it. With Aviva’s boiler cover, for example, you get access to a network of approved engineers, 24/7, if your gas boiler breaks down.

What do you need to think about?

Before you buy a separate boiler insurance policy, make sure you don’t have cover already included in your home insurance.

It all adds up to great value

Have we surprised you with how many insurance policies you could be thinking about as a first time buyer? For more information visit aviva.co.uk.

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