The average home insurance quote has soared by more than a quarter in the past year – the highest increase seen by insurance expert Consumer Intelligence since it started tracking prices in 2014. A typical homeowner will now spend £329 a year insuring their property, according to the Association of British Insurers.
Shopping around tends to be the best way to cut your costs. There are also a number of nifty tricks that can drive the price down further still. Here are our top 15…
1) Pay your bill annually
You can cut your premium by paying for your home insurance in one go every year. If you pay monthly, you are effectively taking out a loan on the full annual amount and will usually be charged interest. The interest could add up to the equivalent of as much as 40 per cent of your annual premium, according to comparison website Uswitch.
2) Increase your excess
When you make an insurance claim, you normally have to cover the first portion – known as the excess – and your insurer takes care of the rest. However, to lower your premiums, you can voluntarily raise the excess, which means that if you claim, you will have to pay more yourself.
For example, increasing your excess from zero to £400 could cut your premium by 25 per cent.
Savvy savings: There are a number of nifty tricks that can drive the price of insurance down
Helen Phipps, home insurance expert at Compare The Market, says: ‘You’ll have to pay both the standard excess and any voluntary excess you add if you make a claim, so make sure you can afford the combined total.’
3) Remove unnecessary extras
Insurers often give you the option to add extras to your policy, including emergency cover. Consider whether you really need these add-ons, says Ceri McMillan, insurance expert at Go Compare.
‘Make sure you aren’t falling into the trap of paying for unnecessary optional extras,’ she says. ‘The best policy for you is the one that offers you the cover you need at a price you can afford.’
Emergency home protection can add approximately £40 to your annual insurance bill, while accidental damage protection can increase your premium by around 10 per cent, according to Peter Smits, of insurance broker Ashbourne Insurance.
Check with your bank to make sure you are not doubling up, as some accounts may include these extras. For example, the Lloyds Bank Premier account offers home emergency cover.
4) Join Neighbourhood Watch
These schemes help to reduce household crime. If there is less crime in your area, then the chance that you need to make an insurance claim is reduced. Some insurers recognise this and will decrease your premium by up to 5 per cent if you are part of the watch, says Smits. To join, visit ourwatch.org.uk/joinNW or call 0116 402 6111.
5) Check admin charges
Insurers may impose an administration fee to change your policy details, including updating direct debit instructions if you switch bank. For example, Esure charges £20 to update your payment details and the Post Office has a £10 fee to make changes to a policy online. In some cases, paying a small amount more for a policy with lower admin fees will save you money in the long run.
6) Cash in on your no-claims discount
If you do not make a claim on your home insurance for 12 months then you could get a discount on your next premium, says Phipps, adding: ‘You are likely to be able to carry over the discount if you switch to another provider, so make sure you include this when you get a quote.’ Depending on your insurer, discounts start from 10 per cent for one year no-claims and can rise to 50 per cent or even higher after five years, according to Go Compare.
7) Check with insurers directly
Comparison websites such as Compare The Market and Go Compare can be useful for shopping around, but some providers including Direct Line and NFU Mutual do not appear on these websites. You should contact insurers directly to check if their premiums are cheaper than others before locking in via a comparison site.
8) Value your possessions
Be realistic about what they are worth, says consumer expert Martyn James, adding: ‘Lots of people overestimate the cost of replacing items, which can raise premiums.’
9) Combine your cover
As a homeowner, you are likely to need both building and contents cover and buying them together could save around £25 a year on average, according to Go Compare.
10) Keep tall trees in check
Some insurers will ask if there are any tall trees around your home, as they increase the risk of your home’s foundations becoming unstable or your roof being damaged.
Homeowners with tall trees around their property spend £87 more on their insurance than those who do not, according to Confused.com. Make sure trees are regularly pruned, maintained and cut back if necessary. It costs about £400 to remove a tree, according to find-a-trader website Checkatrade.
11) Install a safe
Premium protection: A safe can cut cost of insuring jewellery
If you own jewellery or an expensive watch then storing it in a safe could lower your premium. It costs around £150 to fit a small safe.
12) Upgrade your home security
‘Home insurance is all about security,’ says James. ‘The better your alarm, and the more secure your door and window locks are, the cheaper the policy. Even changing or adding an insurer-recommended lock can cut costs significantly.’
You could save between 2 and 10 per cent on your home insurance premium if you upgrade your home security systems, according to lock manufacturer Yale Security.
A monitored smart security system, which includes an alarm linked to a security company, costs about £269, plus a further £293 to install, according to crime data analyst CrimeRate. But you can upgrade your window locks for around £65.
13) Use a free-to-use cashback website
Cashback sites give you money back on purchases when you shop online. For example, Quidco will give you £34 if you buy home insurance using its comparison tool, at quidco.com/compare/home-insurance.
14) Look for a discount
Health service workers and teachers can get a £20 voucher when they buy a combined buildings and contents home insurance policy on price Confused.com or Go Compare.
15) Buy insurance online
Halifax and Lloyds Bank offer a discount of 10 per cent if you buy your home insurance online.
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