I wanted to buy a new phone for the house but while I am searching for the phone most of them have this VoIP but they are expensive? Anyone who can tell me how the whole system works?

I have a BT Line and Sky Tv with broadband package. We used phone mostly in evenings and weekends.

All replies would be highly appreciated.

darlenesmith, are you in the UK? BT to me means British Telecomm. We need to know, because every country has their own telecomm 'rules'. And you'll get the best, most accurate answers from you country men.
VOIP= Voice Over Internet Protocol.

Basically, IF you can do it, your phone service would go over your broadband. How reliable is your broadband? When it has problems, you'll probably have no phone service. I have broadband and I use "Magic Jack", a form of VOIP. However, I retained my good old fashioned phone line. Don't put all your eggs in 1 basket!

ip looks like Chicago