Cost of home insurance is creeping up
Average home cover premiums dropped 1% to £137 in the year to January, said Consumer Intelligence, as providers kept prices low to compete for business.
However, the insurance data analytics firm discovered that the last six months have seen increases of 1.7%, pointing to the likelihood of higher premiums in the future.
It said that last year’s prolonged dry and sunny weather is driving an increase in subsidence claims across the industry, which is expected to feed through into premium rises.
Customers in Wales and the South West are paying the lowest annual bills at £121 and £123. Wales has enjoyed the biggest price falls with premiums down 4.3% on a year ago, while in the North East they fell 3.0%.
At the other end of the scale, Londoners pay the highest annual bills at £181 with prices up 1% in a year while customers in the East Midlands and South West saw price rises of 0.8% and 0.5%.
Premiums for newer homes are the lowest, with average prices for houses built since 2000 at £128. Customers with houses built before 1895 can expect to pay 30% more at £167.
John Blevins, Consumer Intelligence pricing expert said: “Competition in the home insurance market is keeping premium increases to a minimum with only a few areas of the country seeing limited price rises.
“But the past six months has seen premiums starting to rise and that may be an indication of things to come with all parts of the country likely to be affected.
“Claims costs remain the main driver of premiums that we see, and the industry as a whole is experiencing a rise in subsidence claims which are costly for insurers and that will have an impact on total claim costs and prices.”