Home insurance is one of those things most people buy without fully understanding what they are paying for. The big source of confusion is the split between buildings and contents cover, two different things that are often sold together. This guide explains home insurance in plain English, what buildings and contents each cover, and how to work out what you need.

What home insurance is

Home insurance protects your property and the things in it against risks such as fire, theft, storm, flooding and escape of water. Unlike car insurance, it is not a legal requirement, so no law forces you to have it. However, if you have a mortgage, your lender will almost certainly insist on buildings insurance as a condition of the loan, and most people would struggle to replace their home or their belongings out of their own pocket, which is why cover is so widely held.

The two main parts

Home insurance comes in two main parts: buildings cover and contents cover. Buildings insurance covers the structure of your home and its permanent fixtures, while contents insurance covers your belongings. They protect different things, and you can buy them separately or together. Understanding which is which is the single most useful thing to grasp about home insurance, because it tells you what you are actually protected against and where any gaps might be.

What buildings insurance covers

Buildings insurance covers the physical structure of your home: the walls, roof, floors and ceilings, along with permanent fixtures such as a fitted kitchen, fitted bathrooms and built-in wardrobes. It also usually covers permanent outdoor structures like garages, sheds, fences and boundary walls. The idea is that if your home were damaged or destroyed by an insured event, buildings cover pays to repair or rebuild it. Our guide to buildings insurance goes into detail on what is and is not included.

What contents insurance covers

Contents insurance covers the things inside your home that you would take with you if you moved: furniture, electrical goods, clothes, kitchenware, carpets, curtains and personal belongings. If these are damaged, destroyed or stolen, contents cover pays to repair or replace them. A simple test is to imagine turning your house upside down: anything that would fall out is generally contents, and anything that stays put is generally buildings, as explained in our guide to contents insurance.

Combined or separate?

Many homeowners buy a combined policy that covers both buildings and contents from a single insurer, which is convenient and means you deal with one company if you ever make a claim that involves both, such as a fire. You can, however, buy buildings and contents separately, sometimes from different insurers, which can occasionally be cheaper. Whether you need both depends on your situation, which our guide to whether you need both covers in full.

Who needs which

What you need depends on whether you own or rent. Homeowners usually need both buildings and contents cover. Tenants generally need only contents insurance, because the landlord is responsible for insuring the building. Owners of leasehold flats often find the building is insured through the freeholder or a service charge, so they may need contents only. Knowing your position avoids both gaps in cover and paying twice for something already insured by someone else.

How much does it cost?

Prices vary by property and cover, but for context the average combined buildings and contents premium was around £375 a year in early 2026, according to the Association of British Insurers, having eased from a peak in late 2024. Buildings-only cover averaged around £306 and contents-only around £117. What you pay depends on your rebuild cost, location, the value of your contents and your claims history, as set out in our guide to how home insurance premiums are calculated.

Optional extras

On top of the core cover, insurers offer add-ons. Common ones include accidental damage cover, personal possessions cover for items you take out of the home, home emergency cover for things like a broken boiler, and family legal protection. Some are genuinely useful and some you may not need, so it pays to check rather than accept every extra. Our guides to accidental damage cover and personal possessions cover explain two of the most common.

Why claims are rising

Even though premiums have eased, the cost of claims is at record levels, driven largely by extreme weather. Insurers paid out hundreds of millions of pounds in property claims in early 2026 alone, with the average household claim reaching its highest level on record. Storms, flooding and, in hot summers, subsidence all push up what insurers pay, which is part of why premiums, though falling, remain higher than they were a few years ago.

Choosing the right cover

The right cover is the one that would let you repair your home and replace your belongings without financial disaster. For most homeowners that means a combined policy with realistic buildings and contents sums insured, plus any extras that fit your life. The biggest mistake is under-insuring to save a little, which can leave you short at claim time. It is better to insure accurately and look for savings in other ways.

Home insurance and your mortgage

If you buy with a mortgage, your lender will require buildings insurance to be in place from completion, because the property is their security for the loan. What lenders cannot do is force you to use their own insurance: you are free to shop around for buildings cover that meets their conditions, which is often cheaper than the policy a lender offers. Make sure cover starts on the day you exchange or complete, as advised, so there is never a gap while the property is your responsibility.

Review your cover each year

Home insurance is not something to set and forget. Each year, and whenever your circumstances change, it is worth reviewing your sums insured and cover. An extension, a new fitted kitchen, expensive purchases or rising building costs can all mean your existing cover no longer reflects reality. A quick review at renewal, alongside comparing quotes, keeps your protection accurate and stops you either under-insuring or paying for cover you no longer need.

The simplest way to think about home insurance is as two questions: could you afford to rebuild your home, and could you afford to replace everything in it? If the answer to either is no, the matching cover earns its place, and getting both sums right is what makes the policy work when you actually need it.

In short

Home insurance has two parts: buildings cover for the structure and permanent fixtures, and contents cover for your belongings. It is not legally required, but mortgage lenders insist on buildings cover. Homeowners usually need both, while tenants need contents only. The average combined premium was around £375 in early 2026. Insure accurately rather than under-insuring, and add only the extras you actually need.

Where to get help and next steps

To go deeper, read our guides to buildings insurance and contents insurance, then see whether you need both to work out what fits your situation.