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Home insurance prices up 8% from last year

Average buildings and contents policy now costs £132

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The average cost of home insurance has risen by 8% over a year, according to the latest home insurance price index published by Consumer Intelligence.

The report, which tracked home insurance premiums over the 12 months to January, revealed that prices rose steadily throughout the year before peaking in December.

Expensive claims driving up the cost of cover

Pricing experts at Consumer Intelligence cited the rising cost of water damage claims as a reason for the increase in premiums. The weak pound has also driven up the cost of materials, meaning insurers are having to pay out more on claims.

According to the latest data from the Association of British Insurers (ABI), the cost of a water damage claim has risen 31% in the past three years, to an average of £2,638.

The average annual price of a buildings and contents insurance policy now stands at £132, though this depends on the age of the homeowner, any claims history, and the age and location of the property.

Effects of age and location on cost

Homeowners in London pay the most for home insurance, with average premiums of £166 in the capital. Premiums are almost 40% cheaper in the North East, at an average of £119.

Home insurance customers under the age of 50 saw their premiums increase by 8.5% over the year, while those over 50 saw a 7.3% increase.

The report also revealed that older homes are the most expensive to insure, with premiums for pre-1910 buildings averaging £154. Prices for these older properties are rising most quickly, up 10.9% over the year.

How to cut the cost of home insurance

One of the best ways to save on buildings or contents insurance is to shop around for a better deal. Get started by comparing with uSwitch below:

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Spread the cost: 0% APR on monthly payments when you buy your home insurance with uSwitch* today

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