6 Tips to Help Get The Best Home Insurance Prices

The UK’s housing market has recently witnessed significant shifts, not just in property values but also in the associated costs of homeownership. One such cost, that has seen a notable uptick is home insurance prices. Pearson Ham Group’s latest findings shed light on these changes, revealing intriguing patterns and offering valuable advice for homeowners with 6 top tips for getting the best home insurance prices.

Key Points:

  • Home insurance prices rose by 4% in July 2023, indicating a potential slowdown in rate hikes.
  • Over the past year, home insurance costs have surged by 26%, reaching a record high.
  • London homes experienced the steepest increase in premiums at 4.7% in July 2023, totalling 28% over the year.
  • Larger properties, especially those with four or more bedrooms, saw premiums rise above the average rate.
  • Shopping early, exploring multiple comparison sites, and understanding your policy’s details can lead to better insurance deals.

Landscape of Home Insurance Prices

The past year has been tumultuous for home insurance prices. Pearson Ham Group’s research shows that the culmination of monthly increases has led to an overall 26% hike in home insurance prices compared to the previous year. This surge has set a new record, with prices now at an all-time high.

Regional Disparities

Dartmoor view with Haytor in foreground

Geographical differences play a significant role in these changes. London, the bustling capital, witnessed the most substantial growth in home insurance premiums, with a 4.7% rise in July 2023 alone.

This monthly spike contributed to an overall 28% increase over the past year, surpassing the national average by 2%.

In contrast, Wales, while still experiencing a considerable hike, saw the smallest increase at 24%.

Property Size Matters

The size of a property also influences the rate of insurance premium growth.

Larger homes, particularly those boasting four or more bedrooms, were hit harder. Their insurance premiums grew by an impressive 28% over the year, highlighting the need for homeowners to be even more discerning when choosing insurance for more spacious properties.

Period homeowners can also expect to pay more for their home insurance as they are more prone to wear and tear issues or have specific features which may be more difficult or expensive to replace.

The Perils of Underinsurance

A large attractive house

Underinsurance is a situation where the value at which you insure your home or belongings is less than their actual cost or value of replacement. This can lead to significant financial losses if you need to make a claim. Here are some points to consider:

  1. Regularly Review Your Policy: Property values and the cost of belongings can change. Regularly reviewing your policy ensures you’re adequately covered.
  2. Consider Renovations: If you’ve made improvements to your home, they can increase its value. Ensure your policy reflects this.
  3. Itemise Valuables: High-value items like jewellery, art, or electronics might need separate coverage. Make sure they’re not just lumped into general contents insurance.
  4. Understand Rebuilding Costs: It’s not just about market value. If your home was destroyed, consider how much it would cost to rebuild, including materials and labour.
  5. Be Wary of Estimated Values: Some policies offer blanket coverage up to a certain value. Ensure this isn’t less than the total value of your home and contents.

Stephen Kennedy of Pearson Ham Group, said:

“Home insurers have had a to address many challenges. Not least inflationary pressures,  increasing claims and the impact of regulation to pricing. All of which have resulted in home insurance premiums reaching an all-time high.

“The unprecedented rise in home insurance premiums over the past 12 months will be felt by consumers but relief may be in sight. The lower monthly rate seen in July signals a change, and perhaps a return to normalisation in pricing. If not that, it at least suggests a reduction in the level of premium increases expected in the coming months.”

6 Tips for Getting the Best Home Insurance Prices

When it comes to purchasing home insurance, preparation and research are crucial. Here are some invaluable tips:

  1. Start Early: The best deals are often available well before your policy’s start date. Begin your search as soon as you get your renewal notice.
  2. Diversify Your Search: Don’t limit yourself to one comparison site. Different platforms might offer more competitive rates.
  3. Local Brokers & Big Insurers: Some offers won’t appear on comparison sites. Approach local brokers and major insurers directly.
  4. Review Your Cover: Ensure you’re not paying for coverage you already have elsewhere, like accidental damage add-ons.
  5. Understand Excess: Policies usually have compulsory and voluntary excess. Opting for a higher voluntary excess can reduce your premium.
  6. Payment Options: Consider if you’ll pay annually or monthly. An annual payment can often lead to savings.

The home insurance prices landscape in the UK is evolving, with prices seeing unprecedented hikes. Whether insuring your home or safeguarding your valuables, staying informed ensures you make the best financial decisions. Moreover, understanding the risks of underinsurance and ensuring adequate coverage is crucial for homeowners.

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