The average home insurance quote has risen by more than a quarter in the past year – the highest increase insurance expert Consumer Intelligence has seen since it started tracking prices in 2014. An average homeowner will now spend £329 a year on insuring their property, according to the Association of British Insurers.
Shopping around is often the best way to reduce your costs. There are also some neat tricks that can lower the price even further. Here are our top 15…
1) Pay your bill annually
You can lower your premium by paying your home insurance in one go each year. If you pay monthly, you are essentially taking out a loan on the full annual amount and you will usually be charged interest. According to comparison website Uswitch, the interest can amount to as much as 40 percent of your annual premium.
2) Increase your deductible
When you make an insurance claim, you will normally have to cover the first part (the excess) and your insurer will take care of the rest. However, to lower your premium, you can voluntarily increase the deductible, meaning that you will have to pay more in the event of damage.
For example, if you increase your deductible from zero to $400, you can reduce your premium by 25 percent.
Smart Savings: There are a number of useful tricks that can reduce the price of insurance
Helen Phipps, home insurance expert at Compare The Market, says: ‘You’ll need to pay both the standard excess and any voluntary excess you add when 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 don’t fall into the trap of paying for unnecessary optional extras,” she says. “The best policy for you is the one that gives you the coverage you need at a price you can afford.”
Emergency protection for your home can add around £40 to your annual insurance bill, while protection against accidental damage 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 don’t double up, as some accounts may include these extras. For example, the Lloyds Bank Premier account offers emergency home cover.
4) Join Neighborhood Watch
These schemes contribute to reducing domestic crime. If there is less crime in your area, you are less likely to have to make an insurance claim. Some insurers recognize this and reduce your premium by up to 5 percent if you look along, says Smits. To join, visit ourwatch.org.uk/joinNW or call 0116 402 6111.
5) Check the administration costs
Insurers may charge an administration fee for changing your policy details, including updating direct debit instructions if you change banks. For example, Esure charges £20 to update your payment details and the Post Office charges £10 to make changes to a policy online. In some cases, paying a little more for a policy with lower administration costs will save you money in the long run.
6) Redeem your no-claim discount
If you don’t make a claim on your home insurance for 12 months, you can get a discount on your next premium, says Phipps. He adds: ‘You can probably take the discount with you if you switch to another provider, so make sure you mention this when you get a quote.’ Depending on your insurer, the discounts start from 10 percent for one year of claims-free and can increase to 50 percent or even higher after five years, according to Go Compare.
7) Contact 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 whether their premiums are cheaper than others before committing to a comparison site.
8) Appreciate your possessions
Be realistic about what they are worth, says consumer expert Martyn James, adding: ‘Many people overestimate the cost of replacing items, which can increase premiums.’
9) Combine your coverage
As a homeowner, you’ll likely need both buildings and contents cover and if you buy these together you could save around £25 a year on average, according to Go Compare.
10) Keep tall trees under control
Some insurers will ask if there are tall trees around your home, as they increase the risk of your home’s foundation becoming unstable or your roof being damaged.
According to Confused.com, homeowners with tall trees around their property spend £87 more on their insurance than those who don’t. Ensure that trees are regularly pruned, maintained and felled if necessary. According to find-a-trader website Checkatrade, it costs around £400 to remove a tree.
11) Install a safe
Premium protection: A safe can reduce the cost of insuring jewelry
If you own jewelry or an expensive watch, storing it in a safe can lower your premium. Installing a small safe costs approximately €150.
12) Upgrade your home security
“Home insurance is all about safety,” says James. ‘The better your alarm and the more secure your door and window locks are, the cheaper the policy. Even replacing or adding a lock recommended by the insurer can significantly reduce costs.”
According to lock manufacturer Yale Security, you can save between 2 and 10 percent on your home insurance premium if you upgrade your home security systems.
A monitored smart security system, including an alarm linked to a security company, costs around £269, plus a further £293 to install, according to crime data analyst CrimeRate. But you can upgrade your window locks for about $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 the comparison tool at quidco.com/compare/home-insurance.
14) Look for a discount
Healthcare workers and teachers can get a £20 voucher when they buy combined buildings and contents insurance on Confused.com or Go Compare.
15) Buy insurance online
Halifax and Lloyds Bank offer a 10 per cent discount if you take out your home insurance online.
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