Building a house in Ireland, what insurances are needed to protect you
Insurance is one of those area’s that some people think they can do without and by doing so they can save themselves some money, “Wrong”. This is one area that you have to pay a very close attention to and make sure that you are fully covered against anything that could come unexpected.
The idea of “it will never happen to me” does not work and covering yourself and your investment should be one of your main priorities.
The insurance cost in Ireland unfortunately is not cheap and that is why people try to get out of it, but if you do not take cover and something goes wrong, it could cost you your house and more beside. There are a few policies that you will require before and during your project and below you will find an example of some of them;
This is one area that you should not avoid. As a self builder, you invest a lot of money into your project and you need to make sure that your investment is safe from the start of the project.
A Self Build Insurance is a comprehensive cover for your self build. It gives you peace of mind that should something go wrong with any area of your project, you will be covered.
If a building contractor is doing the project for you, then you need to make sure that they have adequate insurance to cover the whole build. This includes insurance for Public Liability, Employer Insurance and Contractors All Risk insurance. You also have to see the policy yourself and make sure that it is not due to run out during the time of your project.
If you are building the house through a project manager or direct labour, you need to make sure that you take out a policy that will cover you for all of the above. This policy has to be in place as soon as you purchase the land as you need to cover yourself against any injury to trespassers, any injury or death to others during construction of your house and any damage that might happen to property or theft of material from the site. These types of insurance can be purchased through an insurance broker or company.
There are a few companies in Ireland that would cover buildings against structural defects. The policies cover the home owner against major structural damage for the first 10 years.
Tip; If you are going to choose a building contractor route make sure that they are a member of an organisation like Homebond.
This is the policy that you take to cover the house against any natural disaster or damage and it also carries on to the time that you move in and can also include your contents. This policy can be arranged through any insurance company, broker or lending institutes.
Tip; Always include accidental damage on your policy to cover against accidents.
This is really a protection policy to cover the mortgage amount should death occur before the term of the mortgage is over. There are different varieties of this policy and they could include a saving portion which are used to cover interest only mortgages. These kind of policies are called Endowment Policies.
Tip; If you are having an Endowment policy to cover your mortgage, do remember that investments can go down as well as up which means that after the term of the mortgage if the investment by the insurance company has not been good enough, you may not have sufficient money to cover your mortgage.
These kind of policies cover you against accident or sickness during the term of the mortgage. They are usually just sufficient to cover the monthly payment of the mortgage, nothing else. These kind of policies can usually be arranged through your lender or insurance brokers.
Other things to consider
Tip: Always read the contract and make sure that you understand how long these policies would cover you for, as most of them are only designed for up to one years payment only.
Tip: Always read the small prints on any insurance policy and make sure that there are no special conditions involved as far as payment and that there are no penalties as far as anything.
Tip: Insurance policies are very important and you should cover yourself at all time, but due to the high cost of insurance in Ireland do shop around for the best policies and do not just take the words of an individual without checking the policy out for yourself. Do remember, this is your investment that you are protecting no one else’s.