Insuring a Granny Annexe in the UK: What You Need to Know

If you’re in the process of purchasing or building a granny annexe—or have recently completed your annexe project—you may be wondering about the next steps for protecting your new asset. One of the most common questions we get from clients at iHus is:

“How do I insure my granny annexe, and who can provide suitable cover?”

It’s a great question. Existing home insurance providers may occasionally be unable or unwilling to extend coverage to include a granny annexe. While this isn’t common—and adding it to your existing policy is often the most cost-effective option—there are instances where a separate, standalone insurance policy becomes necessary to ensure your annexe is properly protected.

That’s why iHus has partnered with PIB Insurance Brokers, a UK-based insurance specialist with deep experience in personal and high-value property insurance, to offer tailored advice and policy options for granny annexes.

We asked Clarke Bailey, Personal Lines Development Executive at PIB Insurance, to share his insights on the ins and outs of insuring a granny annexe in the UK.

Do I Need Separate Insurance for a Granny Annexe?

There are two main approaches when it comes to insuring an annexe:

1. Include the annexe under your main home insurance policy
2. Take out a separate insurance policy specifically for the annexe

Which route is best will depend on how your annexe is used, who lives there, and how it’s constructed. Below, we explore the key considerations, pros, and cons of each approach.

Key Considerations When Insuring an Annexe

You may not be able to add your granny annexe to your existing home insurance policy if:

• The annexe is not on the same title deeds, council tax bill, or shares no utility connections with the main home
• The occupier is not a direct family member
• The annexe is owned by someone else (e.g. a parent or child owns it separately)
• The structure is non-standard construction or is not built on permanent foundations

If any of the above apply, insurers may classify your annexe as a separate dwelling, requiring its own insurance policy.

If You Insure the Annexe on Your Home Policy

If your home insurance provider agrees to include the annexe, here’s what you need to consider:

• Notify your insurer about the additional building, rooms, bathrooms, and occupants
• Ensure the sum insured for both buildings and contents accurately reflects the value of the combined properties
• Review any policy limits for contents, particularly for valuable items like electronics, jewellery, or furniture in the annexe

Pros & Cons of Different Insurance Approaches

Single Policy Approach (Main Home + Annexe)

Pros:

• One policy to manage = simpler admin
• One insurer to deal with in the event of a claim
• One excess to pay if both the main home and annexe are affected in the same incident

Cons:

• Some insurers may offer limited or no cover for annexes
• There may be a cap on outbuilding contents cover
• Public liability issues could arise if there’s ambiguity over who is responsible for the land the annexe stands on

Separate Annexe Policy

Pros:

• Tailored policy that reflects the specific use and risk of the annexe
• Can provide clear, standalone cover—ideal if the annexe is used for rental, holiday letting, or non-family occupation

Cons:

• Two policies to manage
• If a claim affects both buildings, you’ll deal with two insurers and pay two excesses
• Coordination between policies can be tricky in some cases

Specialist Insurance Options for Granny Annexes

At PIB Insurance, we work with a panel of UK insurers to find the right cover for your needs. This includes:

• Geo Insurance – often used for standalone annexe policies
• Standard and non-standard home insurers – if combined household cover is requested

We assess the entire risk profile—including the annexe’s structure, usage, and occupant details—before recommending the most suitable insurance solution.

Who Might Need a Separate Annexe Insurance Policy?

You may benefit from a standalone annexe policy if:

• You plan to rent the annexe to a tenant or lodger
• The annexe is used as a holiday let or Airbnb
• It is owned separately or was funded by someone else
• The annexe is detached and not connected to the main house via utility services

Why Work with a Specialist Broker Like PIB?

General home insurers may not fully understand the nuances of annexe living or provide the flexibility needed for unique arrangements. As a specialist broker, PIB can:

• Offer tailored advice based on your specific situation
• Access policies that are not available directly to the public
• Help ensure adequate cover for both buildings and contents, and eliminate the risk of underinsurance

Final Thoughts: Peace of Mind for Your Annexe Investment

Your granny annexe is more than just an extension of your home—it’s a valuable asset that deserves proper protection. Whether it’s being used as a home for elderly parents, a home office, or a guest space, the right insurance gives you peace of mind.

With iHus’s expertise in bespoke annexe construction and PIB’s specialist insurance knowledge, you’re in safe hands from start to finish.

Get in Touch

If you’d like more information on how to insure your iHus granny annexe, or want to speak to a PIB adviser, feel free to speak to us or contact them directly.

Visit PIB Insurance Speak to PIB Adviser