Property insurance

Buildings insurance

Any legal or equitable interest in property is sufficient to establish an insurable interest in it. Subject to this, a buildings insurance policy provides that the insured will be indemnified by the insurer for loss of or damage to the insured property caused by the perils insured against, such as fire or extraordinary weather events.

Buildings insurance is usually arranged by freeholders and tenants are not typically a party to the policy. There are notable exceptions, including where a leaseholder or tenant may seek to be a joint insured under the policy or are otherwise entitled to receive the insurance money. For practical guidance on these issues, see Practice Note: Insurance—a practical lease negotiation guide.

Where multiple parties have an interest in a buildings insurance policy, it is common for the policy to include provisions protecting each party from the consequences of certain acts or omissions by others, such as a failure to comply with policy terms and conditions or alternations to the insured property. For further guidance, see Practice Note: Insurance—non-vitiation (non-invalidation) clauses.

Property insurance policies do not ordinarily cover damage caused by terrorism.