If I pay cash for a freehold terrace house do I legally need buildings insurance?

AdrianC

How much will buildings insurance be?
How much is the possible payout if something goes very wrong?

Sounds like good value to me.

davidmcn

karljt2013 wrote: »

I believe the odds are massively in my favour of nothing going catastrophically wrong.

They are - that's why buildings insurance is very cheap. Can you afford to rebuild your house (and your neighbours') if something disastrous did happen?

Red-Squirrel_2

karljt2013 wrote: »

Why though? I don't have kids, Am not an alcoholic who could leave the gas on in a drunken stupor, and I believe the odds are massively in my favour of nothing going catastrophically wrong.

What if your neighbours leave the gas on or start a fire that spreads?

What if a bus crashes into the front of your house?

What if you flood in freak conditions even though you aren't on a flood plain and its never happened before?

What if a slow leak that you don't realise is there causes your whole kitchen ceiling to come down?

All unlikely, but they have all happened to people I know (all different people not one unlucky family!)

You can take the risk, but its not one most people would be comfortable with, and the consequences if you bet wrong would be much worse than paying about £100 a year for the peace of mind.

Davesnave

karljt2013 wrote: »

Why though? I don't have kids, Am not an alcoholic who could leave the gas on in a drunken stupor, and I believe the odds are massively in my favour of nothing going catastrophically wrong.

I believed much the same, but someone else set fire to my house, causing £100k worth of damage and rendering it uninhabitable for 6 months. Bit of a blow to come home to, but I was able to house us and start sorting it all out the next day.

If you are wealthy enough to cope with such an emergency, then you might not need insurance, but people who are that rich wouldn't normally question the modest cost of insurance!

saajan_12

The fact that insurance companies make profit means that the mathematical EXPECTATION is you'll be worse off ie.
payout * probability something goes wrong < total premiums paid

The point of insurance however, is to remove the variance of this. In general, assuming you're equally likely to lose/break something as the average person
- if you can afford to replace it -> don't get insurance, just maintain savings
- if you can't afford to replace it -> do get insurance

So for example if you can afford to replace your mobile phone and aren't particularly clumsy/forgetful, there's no point insuring it. With house insurance, you're very likely to never claim but you're paying for the security of not having the variance that if something did happen, you wouldn't lose your home and be unable to get another easily (even if that's renting).

So after that waffle, my point is
OP- it isn't a legal requirement, but don't focus just on how likely you are to burn the house down etc as there are other outside factors particularly for a terraced house e.g. neighbours. The decider should be can you afford to buy another house / sort out other accommodation if something did go wrong?

Slinky

You can't control what other people do or whether they have insurance. These have both happened in the last week.

http://www.bbc.co.uk/news/uk-england-beds-bucks-herts-41580280

http://www.leightonbuzzardonline.co.uk/news/update-diner-thrown-off-seat-when-car-crashed-into-husborne-crawley-pub-1-8188909

Mardle

As Slinky said 'you can't control what other people do'.

We had to claim on insurance 2 years ago when the local 'little dears' decided it was a good idea to play 'cricket' with gravel and pieces of wood they'd broken off a neighbours fence. They broke a large pane of glass in our bay window.

Last year we paid almost £1000 to have our front garden wall replaced by railings because we were fed up of the 'little dears' sitting on it smoking, swearing & generally being a nuisance. Last month this happened https://www.youtube.com/watch?v=rH4pqRzdpHc&feature=youtu.be The driver wasn't aware that he'd hit the railings. They've been pulled away from the wall and can't be straightened. Without the CCTV we wouldn't have known who was responsible and would have had to claim on insurance. Thankfully the company is paying for their replacement.

Car1980

The Grenfell House fire started with a neighbour’s faulty appliance.
My wife’s flat burnt down when her Indesit washing machine burst into flames when she was out (it was switched off).

Housing and contents insurance can be as low as £120 a year. Insurance works because the people who don’t claim pay for the people that do. 100,000 people all putting a tenner in a pot every month to pay for the 5% who claim (and who might claim hundreds of thousands) is a good deal. Phone insurance on the other hand, maybe not

Rambosmum

You don't need it. However get it. It's not expensive.


Our close friend owned a house which had to be knocked down due to a gas explosion caused by a neighbour (it was in the news, a child died - not the friends child). He owned the house outright so didn't have insurance. He now has no house and just a piece of land where a terrace house used to be and no way to rebuild it. The neighbour also didn't have insurance, so no way of claiming the money from them.

Mossfarr

Have we managed to convince you that you really should have insurance??