Do Garden Rooms Affect Your Home Insurance? Find Out Here

As garden rooms grow in popularity across the UK—whether as home offices, gyms, studios, or annexes—many homeowners forget to ask a critical question: how does a garden room affect your home insurance? A garden room may be detached, but it’s still part of your property’s value and risk profile. And while it may not seem like a big deal to erect a stylish outbuilding at the end of the lawn, insurers often take a different view. In this article, we’ll explore the insurance implications of installing a garden room. We’ll explain when you need to notify your insurer, what coverage options are available, how different uses and features affect premiums, and what you should do to keep your policy valid—and your investment protected.

What Is a Garden Room in Insurance Terms?

From an insurance perspective, a garden room is typically classified as an outbuilding—a structure separate from the main home, but within the boundary of the property. This classification matters because most standard home insurance policies include some cover for outbuildings like garages, sheds, and greenhouses—but the default cover might not reflect the true value or use of a modern, high-spec garden room. For instance, a timber summerhouse worth £5,000 may fall within a typical policy’s outbuilding cover, but a £60,000 fully insulated office with electrics, data cabling, and underfloor heating likely will not.

Do You Need to Tell Your Insurer About a Garden Room?

Yes—always. Any significant addition to your property, whether it’s a conservatory, extension, or garden room, should be reported to your insurer. Why? It increases the rebuild cost of your home. It may increase the value of your contents if you use it for work or hobbies. It introduces new security and fire risks (e.g., electrical wiring, expensive equipment). Some insurers consider it a change in risk profile, especially if it’s used as a business premises. Failing to notify your insurer can invalidate your policy or lead to reduced payouts in the event of a claim.

What Insurance Cover Do You Need for a Garden Room?

A typical home insurance policy has two components:
Buildings Insurance
This covers the cost of repairing or rebuilding the physical structure. If your garden room is a permanent fixture—built on a concrete base, professionally installed, and connected to utilities—it should be covered under your buildings insurance, but only if you’ve declared it. Points to check: Is the garden room included in the rebuild cost you declared when setting up your policy? Does the policy define “outbuildings” clearly—and does the garden room qualify? Is the roof type, material, or construction method (e.g., timber frame, SIPs, steel) relevant?
Contents Insurance
This covers items stored inside the building. If your garden room contains computers, musical instruments, gym equipment, or furniture, you’ll want to know: Is contents cover extended to outbuildings? Is there a maximum claim limit per outbuilding (often £2,500–£5,000)? Are certain items (like electronics or business equipment) excluded or capped?

Do You Need Specialist Insurance for a Garden Room?

Not always, but in some cases, specialist garden room or outbuilding insurance may be necessary, especially if: The value of the structure exceeds your insurer’s standard outbuilding cover. You run a business or store customer data on site. You allow guests to stay overnight (e.g., Airbnb or annex use). You install plumbing (which increases water damage risk). Your garden room is self-contained and liveable. Some insurers offer garden room add-ons or standalone outbuilding policies. These typically cover: Fire, flood, and storm damage. Theft or vandalism. Accidental damage. Business use (if declared). Higher limits for contents.

How Does Business Use Affect Your Insurance?

Using your garden room as a home office or commercial studio? Tell your insurer. Business use can affect the terms of both your buildings and contents insurance.
Common examples of business use: A graphic designer running a home office. A therapist seeing clients in a dedicated studio. A yoga instructor holding small classes. An eBay seller storing inventory.
Depending on your insurer, business use might: Be excluded completely from a standard policy. Require a specialist business insurance add-on. Affect your public liability exposure. Increase premiums due to perceived risk.
If you employ staff, have client visits, or store stock, you may need: Employers’ liability insurance (a legal requirement). Public liability cover. Business interruption insurance.

Do Garden Rooms Increase Your Home Insurance Premium?

Sometimes, yes—but not always. The impact on premiums depends on: The value of the structure. Its use (personal vs. business). Security measures in place (e.g., locks, alarms). Location (crime rate, flood risk).
A small garden room used as a spare reading space may have no effect, but a £90,000 annex with a kitchen and bathroom could increase premiums by hundreds annually. Premiums typically rise because: There’s more to rebuild in the event of a total loss. There's higher risk of theft or vandalism. More contents need covering.
The good news? If the garden room adds substantial property value, insurers may view the property as more desirable, potentially offsetting some of the increase.

What Security Measures Help Lower Risk and Premiums?

Most insurers want to see basic physical protections in place for any detached building. This includes: Insurance-approved locks on all doors and windows (BS3621 or equivalent). Outdoor lighting or motion-sensor floodlights. Alarm system or CCTV covering the garden room. Internal safes for high-value items. Toughened or laminated glazing.
The better your security, the better your chance of: Getting full cover. Qualifying for lower excesses. Reducing your overall premium.
Tip: Take detailed photographs of the garden room, its doors, locks, and contents. These can be invaluable during claim assessments.

What About Damage from Trees, Weather, or Subsidence?

Your insurer will ask about: Proximity of trees—roots can cause subsidence. Flat roofs—higher risk for leaks and storm damage. Flood risk zones—especially if the garden room is at a lower elevation.
Standard cover usually includes: Storm damage to roof or structure. Impact from falling trees or branches. Fire and theft. Subsidence (if declared during setup).
However, exclusions often apply to: General wear and tear. Water ingress through improperly sealed structures. DIY-built rooms with no professional guarantees.

Are You Covered During Construction?

During installation, your existing home insurance may not cover works in progress, especially if: The builder is not using an approved contractor. There are deep excavations or drainage works. Structural connections to the main house are being made.
Solutions include: Builder’s insurance (should be in place already—ask for proof). Extension of home policy during works (some insurers allow this). Dedicated project insurance for high-value garden rooms.
Also: Don’t forget to update your policy once construction is complete—otherwise your new asset might be completely unprotected.

Real-Life Scenarios and Insurance Tips

Scenario 1: Home Office in a 4×3m Cedar-Clad Pod
Cost: £25,000. Used for remote work, contains laptop, printer, £2,000 desk setup. Insurance Action: Notify insurer, confirm contents coverage, declare business use. Likely small premium increase (£20–£40/year).
Scenario 2: Teen Hangout Room with TV, Games Console, Sofa
Cost: £18,000. Used by family only, contains £3,000 in electronics. Insurance Action: Ensure outbuilding contents limit covers electronics. Consider upgraded locks and an external security light.
Scenario 3: Airbnb Guest Lodge with Ensuite
Cost: £70,000. Plumbed-in annex, guests stay 100 nights/year. Insurance Action: Specialist policy or short-let insurance required. May need separate public liability cover. Expect a premium increase.

What If You Don't Inform Your Insurer?

Failing to disclose a garden room can cause: Reduced claim payouts. Denied claims (especially for burglary or fire). Cancellation of policy. Breach of insurance contract. Don’t assume the structure is automatically covered under existing terms. Transparency is key to protecting your property—and your peace of mind.

Checklist: Insuring Your Garden Room Properly

1. Notify your insurer before or immediately after installation
2. Clarify if it’s included under buildings and/or contents
3. Declare any business use or Airbnb-style letting
4. Itemise valuable contents stored inside
5. Review security measures and consider upgrades
6. Ask about specialist garden room cover or endorsements
7. Update rebuild cost on your policy if value is significant
8. Take photos and keep receipts for construction and contents

Conclusion

Installing a garden room adds usable space, comfort, and often property value—but it also affects how your home needs to be insured. Whether your structure is a compact writing studio or a fully functional guest annex, it’s essential to notify your insurer, confirm the extent of cover, and take steps to protect your investment. Garden rooms blur the lines between indoor and outdoor living—but your insurance shouldn’t be fuzzy. Clear communication, appropriate declarations, and smart security ensure that your beautiful new space is protected from day one—and that you don’t face any nasty surprises when making a claim.
Need more clarity on your insurance situation? Speak to your insurer or a specialist broker before you build. A five-minute call now could save you thousands later.