Home Insurance Price Hikes
Catherine Alexander
Partner & Mortgage and Protection Adviser at GDA
After more than a year of record home insurance increases, it may be a good time to check your home insurance if you haven’t done so for a while. Consumer Intelligence, which tracks insurance pricing, says the average price quoted went up by almost 42% in the year to April 2024. If you are coming up to a renewal date, don’t just let your policy renew without checking it first. You can do this on one of the many product comparison websites, or by speaking to one of our advisers who will be able to run a comparison for you of a wide range of competitive insurers.
The increased costs have been due to a number of factors, according to the Association of British Insurers. The rise in the cost of labour and materials when getting repairs done is a major factor, along with an increase in the number of extreme weather events.
It is important to make sure that you get the cover that you need. Everyone, including those who are renting, should consider contents insurance, but buildings insurance is usually only for freehold homeowners. Many people also over insure their properties, insuring the property for its market value, but it actually needs to be the rebuild cost that you are insuring (which is lower as this excludes the cost of the land).
If you want to stay with your insurer, you can also try speaking with them directly and trying to get a better deal. Speak to them armed with quotes from other insurers and they may price match for you. It is worth a try and is often successful.
Some insurers may also allow for policies such as home and car to be combined for a lower price, and paying a higher excess on any claim can also reduce the premium.
However as premiums rise, don’t be tempted to underinsure – for example, where the value of your contents is £40,000, but you only insure it for £20,000. Although it may lower the premium, it could leave you significantly out of pocket if you make a claim.
This article isn’t personal advice. If you’re not sure whether a course of action is right for you, ask for financial advice.
