General Insurance Article - This is why your home insurance premiums have risen

 By Liz Hunter, Commercial Director at MoneyExpert

  

 This increase is down to inflation mainly – as is the case with many other industries. Home insurance providers are finding repairs and labourers generally more expensive, and are passing these extra costs onto consumers in the form of price increases.

  

 Here are some of the other reasons why your home insurance premiums are increasing:

  

 Climate change - A rise in extreme weather events, like flooding and damage to homes from storms, for example, can have a significant impact on insurance premiums and the excess that consumers have to pay when making a claim. Insurance premiums are determined by assessing risk, and extreme weather events can increase the frequency and severity of claims, which in turn has an effect on the cost of providing coverage. Insurers also paid out nearly £600 million for weather-related damage to people’s homes in 2024, according to the ABI. This has resulted in insurance providers passing these costs on to customers.

  

 Size of your home - The size of your property has an impact on the cost of home insurance. Larger homes will naturally cost more to fix or rebuild if damaged, so are typically more expensive to insure than smaller homes. If you have a large family that has since moved out, and you no longer need the additional rooms, it may be worth downsizing to reduce the cost of your home insurance.

  

 The area you live in - If your area has high crime rates or if you live in an area known for flooding regularly, then your insurance provider may see you as more likely to make a claim. This in turn increases your premiums and means that you may struggle to find one at a good price. If your area is at a particularly high risk when it comes to flooding, you may need to find a provider which offers specific insurance for areas with a high flood risk. An increase in people making claims in your area could also have an impact on your own premiums too.

  

 Home improvements that could cause issues - If you’ve renovated your home recently, it’s worth noting that the type of materials used could have an impact on the cost of home insurance, particularly if replacements are hard to find or require specialist tradespeople to repair. This is because it would naturally cost more for labourers to source the supplies or cost more to get a specialist in to do the repairs. It’s worth bearing in mind what you use and how you update your home before making any changes to see how it could impact your premiums.

  

 The value of your contents - If you have a lot of expensive items that you need to insure, this will typically increase your premiums. These costs will increase if you need to insure these items separately due to their value.

  

 Optional extras - If you look at adding additional optional extras to your home insurance policy, like accidental damage cover or personal possessions cover, you will definitely see a rise in the cost of insurance as you’re getting more cover than the basic offering. Try looking at combined cover to see if this will bring your costs down, as it’s usually cheaper than taking out separate policies with different providers.

  

 As the cost of living crisis continues to affect millions around the country and the costs of other household bills, such as energy, food, and utility bills continue to rise, many will be looking at areas where they can save money. Luckily, there are a number of options that could help you reduce costs and obtain a much better deal. Here are 10 ways that you can get the best deal and help reduce your home insurance premiums:

  

 1. Don’t auto-renew & always use a price comparison site

 When you’re due to renew, you should always use a price comparison site to compare rates from multiple providers to find the best deal and never automatically renew. Not only will it save you time but it can help save up to £209* and offer a wider range of providers. MoneyExpert, for example, can help you compare deals from over 50 of the UK’s top providers. Simply input your details and the comparison site does the rest, scouring a number of home insurance companies to find the best deal for your needs. If you find one cheaper than your current provider is offering but would prefer to stick with them, you could always call them up first and see whether they can match it or offer you something better.

 2. Renew early

 The best time to get your new home insurance quote is around 15 days ahead of your renewal, so try to plan ahead and renew early, if you can. This is because insurers can charge you more if you leave arranging a new home insurance policy until the last minute.

 3. Build up your no claims bonus

 You will generally be offered a no claims discount if you go without claiming for several years, so it’s worth making sure you only put in a claim on your home insurance when it’s absolutely necessary. Otherwise, you’ll be increasing the costs upon renewal.

 4. See if you can get cashback

 Sometimes you can get cashback on your purchases by using cashback sites, like QuidCo, Airtime or Topcashback. But did you know that you can also get some home insurance policies through them? You could go straight through a cashback site and get whatever offers they have on there. Or you can use a comparison site to find and compare the best deals, and then make the purchase through a cashback site so that you find both the best deal and get money back for it. However, it’s important to remember that cashback is not technically ‘free money’, because you still need to spend money to actually earn it. If you’re going to make the purchase anyway then you may as well pay by debit or credit card to get a cashback or reward on top, if it’s worth it. But I would advise against making a purchase purely to get cashback. If you can get a better saving on a price comparison site, I would always advise that you go where you’re going to get the best deal.

 5. Pay upfront rather than monthly

 Choosing to pay for your home insurance premiums monthly by direct debit can make life easier by breaking the cost up into manageable chunks over the course of a year. However, insurers charge more for this option as you’re opted into a credit agreement, paying interest on top of the annual premium.

 If you can, it’s always worth paying for your insurance upfront to get the best deal and avoid paying interest or admin fees. If you’re unable to pay upfront, you could also consider signing up for a 0% credit card and make smaller monthly payments until it’s paid off instead to avoid the additional charges from your insurance providers.

 6. Bundle your policies

 Do you have other policies with any insurance providers for a pet or your car, for example? If so, it might be worth calling them up and seeing whether you could save money by bundling your insurance policies with the same provider. Many insurers offer discounts for having multiple policies with them.

 7. Improve your homes’ security

 If you invest in some high-security locks on your doors or windows, install burglar alarms or set up security cameras around your home, this could make your home insurance cheaper. This is because you’re less likely to be targeted by burglars, resulting in home insurance providers seeing you as less of a risk. Always be sure to let your insurer know if you do install any of these features.

 8. Avoid leaving your home empty

 Try to avoid leaving your home unoccupied as much as possible, if you can. Empty homes run the risk of being targeted by burglars or can be damaged by fire or water from any accidents. It’s worth ensuring you have security in place for when you do leave it empty, as well as making sure any electrical sockets are switched off and all taps are definitely off.

 9. Check for loyalty discounts

 If you don’t ask, you don’t get. If you’ve been a customer for a long time or have other policies with your provider, you may be eligible for discounts or money off vouchers, so it’s always worth double checking. Some organisations also offer discounts if you’re part of a specific organisation like the NHS.

 10. Review your coverage

 It pays to review your policies regularly, particularly when they’re due for renewal, to ensure that they align with your current needs. You might find that certain types or optional extras are no longer necessary, and adjusting these may reduce costs.