An annexe or granny flat, occupied by a family member and which forms part of the main building can be covered under the same Buildings and Contents policy. The sum insured must be sufficient to cover the whole property and its contents.
Where the annexe or granny flat is a separate address i.e. has its own entrance and registered address, then this needs to be treated as a separate property and a separate Buildings and Contents policy is required.
If the annexe or granny flat is rented out under a tenancy agreement, then you should take out a Landlord Insurance policy provided it has a separate address.