Cost of home cover hits four-year low
The average cost of a combined home insurance policy fell to just £309 in the second quarter of 2016, according to the Association of British Insurers (ABI).
This marks its lowest level in the four years that the trade body has been collecting the data.
Despite the severe winter flooding which is expected to cost £1.3bn, insurers have kept home premiums at competitive levels, with a combined policy falling in cost by £1 since the first quarter of this year and by £2 since the same quarter last year.
Buildings only policies cost an average of £265, an increase of £11, or 4%, compared with the previous quarter, when it was £254. This is in line with similar increases seen between Q1 and Q2 in previous years.
Contents only policies cost an average of £138, a slight increase of £1 since Q1 2016.
Mark Shepherd, ABI general insurance manager, said: “As seen during the severe winter floods, home insurance provides valuable protection from events that can force people out of their homes and destroy their belongings.
“So it’s good news that homeowners are making the most of a very competitive home insurance market by shopping around to get the best deal that meets their needs. Our recent guide on ‘Home Insurance’ can help customers understand the different policies available to get the right level of cover, which may not be the cheapest.”
He added that home insurers have also continued to offer competitive deals despite the recent increases in Insurance Premium Tax for customers. “Home insurance is essential to protect people’s homes and possessions, so in order for competitive prices to continue, it is imperative that any further moves that could increase the cost are avoided.”