Buildings and contents insurance, and Flood Re
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Quick answer: Buildings insurance covers the structure of your home (and is mandatory if you have a mortgage).
Buildings insurance covers the structure of your home (and is mandatory if you have a mortgage). Contents insurance covers what's inside. Flood Re, a joint initiative between the government and insurers, helps make flood cover available and affordable for around 353,000 higher-risk households, and is due to run until 2039.
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Content updated: 4 min read
Primary source: www.floodre.co.uk/find-an-insurer/eligibility-criteria
Buildings insurance: what it covers
Standard buildings cover protects the structure of your home — outer walls, roof, floors, ceilings, fitted kitchens and bathrooms, permanent fixtures, garages and outbuildings — against perils like fire, lightning, escape of water, storm, flood, theft, vandalism and subsidence.
Sum insured is the rebuild cost, not the market value. The Building Cost Information Service offers a free rebuild calculator at abi.bcis.co.uk. For unusual or listed buildings, get a surveyor's rebuild assessment.
If you have a mortgage, the lender will require buildings cover as a condition of the loan. Leasehold flats normally have buildings insured by the freeholder; you only need contents.
Contents insurance: what it covers
Standard contents cover protects personal belongings inside your home — furniture, electronics, clothes, kitchenware — against fire, theft, flood, escape of water, etc.
Optional add-ons include accidental damage (spills, breakages), personal possessions (cover for items taken outside the home — phones, jewellery, bicycles), pedal cycle cover, and home emergency.
High-value single items (jewellery, watches, artwork, musical instruments) usually need to be specified individually above a single-item limit (typically £1,500–£2,500).
How Flood Re works
Flood Re is a joint initiative between the government and insurers, funded by an annual levy on every insurer offering home insurance in the UK (£160 million a year). Insurers can choose to pass the flood risk on eligible home insurance policies to Flood Re, which charges them a fixed premium based on the home's council tax band; the price you pay is still set by your insurer. In the year to 31 March 2026, around 353,000 policies were covered by the scheme.
Flood Re is due to run until 2039, when insurers should be offering cover based on each property's actual flood risk. Its Build Back Better scheme lets participating insurers pay up to £10,000 for flood-resilience measures as part of a flood claim, on top of the repairs.
To be eligible, a home must be used for private residential purposes, be in council tax band A–H (or equivalent), be a single home or in a building with no more than three homes, and have been built before 1 January 2009. Commercial properties and blocks of more than three flats are excluded from buildings cover; buy-to-let homes are eligible only if they meet all the criteria. See Flood Re's eligibility criteria.
Avoiding underinsurance and the 'average' clause
If your sum insured is too low, most policies apply an 'average' clause to claims — meaning a claim is reduced in proportion to how underinsured you were. If you insure £15,000 of contents but really have £30,000, a £5,000 claim could be cut by half.
Review your sum insured each renewal, especially after big purchases, home improvements or rising rebuild costs.
Common questions
Do I need accidental damage cover?
It's optional and adds to the premium. It can be worth it for households with children or pets, or for high-value items, but it doesn't usually cover wear-and-tear or poor workmanship.
Are my bicycles covered?
Bikes are normally only covered inside the home as part of contents. Cover when away from the home usually needs personal possessions cover, often with a per-item limit and a security requirement (e.g. an approved lock).
What is escape of water and is it covered?
Escape of water means a leak from plumbing (e.g. a burst pipe). It is one of the most common buildings claims and is included in standard cover, though some policies have a separate excess for water damage.