Save Now on Your Home Insurance Costs

As living costs continue to rise, homeowners are increasingly looking for strategies to cut their expenses without compromising value. Home insurance costs are a potential area to be able to make meaningful savings.

Key Points:

  • Annual Over Monthly: Opting for annual insurance payments can sidestep added fees and interest, potentially slashing premiums by around 10%.
  • Home Safety Measures: Investing in robust locks and home security devices not only protects your home but can also lead to significant reductions in insurance premiums.
  • Precise Cover Requirements: Ensure you’re neither over-insuring nor under-insuring by determining the exact coverage needs for both your property and its contents.
  • Underinsurance Awareness: Understanding and avoiding underinsurance is paramount to ensuring full coverage when unfortunate incidents arise.
  • Market Comparison: Regularly comparing quotes from various insurers can unlock substantial savings and tailored coverage benefits.

Save by Paying Annually

Country Property

Chris Lear of One Sure Insurance suggests that while many opt for monthly insurance payments for easier management, it’s worth noting that such an approach often includes admin fees and additional monthly interest.

Statistics indicate that home insurance premiums can surge by up to 10% with monthly instalments. Therefore, opting for annual payments is frequently a more economical choice.

If the upfront cost seems daunting, consider using a low or 0% interest credit card to cover the annual payment, ensuring you settle the card balance monthly.

Improve Home Security

Installing robust locks isn’t just about safety and protection from theft; it’s also about savings.

Locks, especially a five-lever mortice deadlock compliant with British Standard 3621, are viewed as highly secure by both the police and insurance companies and may result in cheaper home insurance costs.

If unsure about your current lock, check it and if it’s not up to standard, prices for these locks typically range between £25 and £60 online. Furthermore, bolstering home security with alarms, surveillance cameras, or window locking mechanisms can potentially give you further discounts on your insurance premiums.

Tailored Coverage Can Help Reduce Home Insurance Costs

Moving boxes labelled for a house move

When choosing a home insurance policy, be as accurate with the cover you need as you can.

Over-insuring can inadvertently increase your policy cost for example does a standard policy provide you with the cover you need or do you really need the add-on accidental cover that the insurer is offering?

Other add-on insurance cover likely to be available includes

  • Cover away from home or all-risks cover
  • Legal expenses cover
  • Home emergency assistance

Buy Buildings or Contents Cover or both?

Decide whether you need building cover, contents cover, or both. To help decide:

Contents Insurance

bottles of wine in a rack

Contents Insurance covers the personal belongings and items within your home from such as theft, fire, flood, and other potential damages. It’s cover basically for all the things you’d take with you if you moved home – everything from your electronics, furniture, and appliances, to personal items like jewellery, clothing, and even the food in your freezer.

There’s often a limit, so you need to check that this is enough to cover the value of all of your belongings. There’s also likely to be single item limit so if you have any hight value items, say an expensive watch, some artwork or maybe a wine collection, then you may need a higher limit and potentially need specialist, high value insurance to get the cover you need.

Buildings Insurance

Building insurance covers the structure of your home (roof, walls and windows) as well as permanent fixtures and fittings such as a fitted kitchen. Depending on the policy, it may also cover outbuildings such as greenhouses and garden sheds but you’ll need to check the specifics. 

Some home insurance providers offer discounts for combined building and contents policies, which might be more cost-effective than separate plans. Conversely it may be possible to reduce your home insurance costs by using different providers for each of your contents and buildings insurance.

Insurance TypeDescription
Building CoverProtects the physical structure of your property.
Contents CoverCovers personal belongings within the property.
CombinedA bundled option offering coverage for both aspects.

Consider Your Voluntary Excess

When taking out an insurance policy, there’s invariably a compulsory excess you’ll have to pay if you make a claim.

In addition, there’s a voluntary excess, the amount of which you decide on. By increasing the excess amount you’re willing to pay, you might reduce your home insurance cost. However, it’s crucial to strike a balance to avoid hefty payouts should you need to make a claim.

Proactive Home Maintenance to Keep Your No Claims Discount

Repairing a roof

Simple upkeep can result in reduced home insurance costs. This is because you’ll less likely need to make a claim and be able to keep or increase your no claims discount.

Addressing weather damage promptly, insulating pipes, and monitoring potentially problematic trees can all help.

A No Claims Bonus (NCB) or No Claims Discount (NCD) is a significant incentive provided by many insurance companies, rewarding policyholders for not making claims over a specific period. Every year that you don’t make a claim, this bonus accumulates, often leading to a sizeable discount on premiums over time which obviously helps reduce your home insurance costs.

If faced with minor issues or damage, it might be financially worthwhile to weigh the immediate costs of repairs against the long-term benefits of your accumulating NCB. Of course this doesn’t mean you should avoid claims at all costs; it’s just about you making informed decisions.

Make Sure You Are Not Underinsured

Underinsurance occurs when the value at which you insure your home or belongings is less than their actual worth or replacement cost. This means that in the unfortunate event of a claim, you would only be partially covered, leading to potentially significant out-of-pocket expenses.

To ensure you avoid being underinsured, it’s crucial to periodically assess the value of your property and possessions, ensuring they are accurately represented in your insurance policy.

Why Avoiding Underinsurance Matters

house on fire burning flames

Imagine having a house fire, then discovering that you’ve only insured half the value of your home. You would only receive 50% of the claim’s value, regardless of the policy’s limit. The implications of underinsurance can be financially devastating, especially during life’s unexpected calamities.

As you look to save money on your home insurance costs clearly it is vital that you don’t do so by undervaluing your property or possessions and thereby risking underinsurance.

4 Tips to Avoid Underinsurance

  • Professional Valuations: Consider hiring a professional to assess the value of your property and high-worth items every few years.
  • Inventory List: Keep an up-to-date inventory of personal possessions, alongside their values. Regularly update this list, especially after major purchases.
  • Check Policy Terms: Some policies might have a single item limit. Ensure any items above this limit are separately listed on the policy.
  • Factor in Renovations: If you’ve renovated or made significant home improvements, they can influence your home’s value. Update your policy accordingly.

You may find getting advice from an insurance broker will help you get the best policy for your needs. With their expert knowledge and access to insurer products, they may even be able to save on your home insurance costs.

At the very least though as you buy cover, either via a broker or directly, having the right home insurance will help give you peace of mind.

Shop Around and Compare Home Insurance Quotes

A woman online using a laptop

Getting home insurance quotes from multiple insurance providers is straightforward and with online aggregators, such as MoneySuperMarket or Comparethemarket you can get multiple quotes by entering your details just once.

Whilst with these online home insurance quote engines, the information collated is the same, each insurer uses its own criteria to calculate the premiums, meaning prices can vary considerably for the same level of coverage.

By comparing quotes, you can ensure you’re not only getting the best home insurance costs but also the right coverage for your needs.

Of course, depending on your needs and how much you want to undertake yourself with online quotes, you may find value in speaking with a insurance broker to get their advice and help in getting you the right cover, and helping you manage your home insurance costs optimally.

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