Your home and its contents are probably the most valuable things that you own, so it’s essential that you have adequate home insurance in case something goes wrong.
All too often, customers are tempted to buy cheap policies that they find online. Although no one wants to pay more for home insurance than they need to, you must make sure that you have the right level and type of cover – be aware that low cost can mean low value.
Here are our top 10 tips for finding the best deal on your home insurance.
1. Shop around.
It really does pay to shop around for your home insurance. Many insurers push up premiums after the first year, so renewing your policy may cost considerably more than your first year’s cover.
Always invest some time in looking to see what deals other insurers are offering; even if you’re happy with your current insurer, it’s worth seeing if a better deal is available elsewhere, and asking your existing provider to match it.
2. Buy buildings and contents cover combined.
If you’re a homeowner, you’ll need to insure the structure of your home as well as its contents.
While you can buy two separate policies with different insurers, you’ll often find it’s cheaper to buy a combined buildings and contents policy instead.
As well as a lower premium, the claims process with a combined policy is usually simpler too. Many home insurance claims cut across both buildings and contents insurance, e.g. forced-entry burglary. It’s easier to manage a claim if you only have to deal with one insurance company.
3. Only buy the cover that you need.
There’s no such thing as a standard home insurance policy. Different policies will offer different levels and types of cover. Generally speaking, the more cover you buy, the higher your premium will be. So it’s important that you only select the cover that you really need.
If your contents are worth £20,000 for example, you probably don’t need a policy that provides £50,000 of cover.
Don’t forget to bear in mind any insurance that you hold elsewhere that crosses over with your household policy, such as the cover provided through your bank account. If your mobile phone is insured through your bank account, for example, you won’t need to add it to your home insurance policy.
4. Pay your premiums annually.
Many people value the ability to pay their premiums monthly as it helps them to budget. However, be aware that most insurers charge an admin fee to customers paying in instalments, and it’s common for them to also charge interest. As such, if you can afford to do so, paying your annual premium in one go will usually save you money.
5. Increase your excess.
When you buy home insurance, you’ll be asked to select your voluntary excess. This is the amount of money that you’ll have to pay towards any claim that you make, in addition to the compulsory excess set by your insurer.
Generally, the higher your voluntary excess, the lower your premium.
6. Protect your home against fire.
Fire is the single most costly cause of home insurance claims so, as well as being crucial from a safety point of view, installing smoke alarms can reduce your premiums.
Smoke alarms should be fitted throughout your property, at least one on every floor, and need to be tested regularly.
7. Install a burglar alarm.
Many insurers will offer lower premiums to customers with working burglar alarms – discounts of up to 7.5% aren’t unheard of.
If you’re considering installing an alarm, check first to see which models are on your insurer’s ‘approved’ list.
8. Install approved locks.
Most insurers will ask about the locks you use at home, and will offer lower premiums to homes that are properly secured.
Five-lever mortise locks are usually recommended for all external doors, while windows should have two bolt locks.
Some insurers will also reduce your quote by up to 5% if you’re a member of your local Neighbourhood Watch scheme.
9. Only claim when you really have to.
Your claims record is one of the most important factors affecting your premium. The more claims you make, and the more expensive those claims are, the higher your premium is likely to be.
Customers with years of no claims are usually rewarded with significantly lower premiums – up to 50% reduction for 5 years no claims discount.
So although insurance is there to pay out when something goes wrong, it’s worth considering whether it would make better financial sense to use your savings to sort out any minor problems, thereby protecting your no claims discount.
10. Use a broker.
Last, but by no means least, use a broker to help you find the best value home insurance policy.
An experienced broker will help you identify exactly what protection you need, so you won’t pay for cover you can’t use. They’ll also do all the shopping around for you - and because they’ve built good relationships with many different insurance companies, they’ll often have access to great deals that aren’t available to customers buying their insurance direct.