While many homeowners across the country have been hit with substantial increases in premiums – the typical cost for buildings and contents cover has gone up by 6% over the last 14 months – people living in Surrey and Scotland have been hardest hit by price rises.
Analysis of 3.4 million quotations, conducted by moneysupermarket.com, reveals that these unfortunate individuals have seen their home insurance premiums jump by up to 46% over the last 14 months, with those living in Dorking, Surrey suffering the largest increases.
Cover provided for households in Dorking has soared from an average of £119 to £174 since February 2010 – that’s a rise of 15p per day.
Meanwhile, homeowners living in the city centre of Edinburgh and Milngavie in Glasgow have experienced similar increases of 45% and 40% respectively.
And people based in Greater London have also had to find the extra cash to cope with above-average premium hikes; five of the top twenty hardest hit areas in the country are within this area.
Prepare for even higher costs
The bad news is that premiums look set to continue rising apace – wherever you live.
Julie Owens, head of home insurance at moneysupermarket.com said: “The cost of insuring homes in the UK is steadily on the increase.
“Unfortunately for consumers, things look set to get worse with the increase in prices unlikely to slow down in the coming years.”
The reason that the cost of cover is increasing is because the number of claims being made on home insurance premiums has risen in recent years, causing insurers to hike premiums in order to cover their costs.
Reasons for this increase in claims include a surge in crimes such as burglaries since the onset of the economic downturn, a rise in the number of fraudulent claims being made and the cost of repairs from extreme weather damage.
Why are some areas being harder hit than others?
When calculating how much to charge you for your home insurance, insurers take a number of factors into account, including where you live.
If, for example, your property is classified as being in a ‘high-risk' area – whether for crime, flooding or even fraudulent claims – this will be reflected in your insurance premiums.
That is not to say that living in a “rough”, crime-ridden area will always result in you paying more, though. In fact, living in a more affluent area such as Surrey will also increase premiums as property and contents values will generally be higher.
Owens said: “Insurers use postcodes as a part of the overall risk factors when calculating premiums.
“So unfortunately, postcodes can dramatically affect how much people pay for their home insurance premium.”
What can I do to reduce the cost of home insurance?
Although there is very little you can do about the postcode in which you live, except move house, there are steps you can take to reduce your premiums.
Sensible moves include installing a good home security system and security lighting.
Time-switch lights will give the impression that you are at home when you are not, reducing the risk of having to make a claim for burglary, while the NACOSS standard alarm, for example, can cut premiums with some companies by 7.5%, more than wiping out the average increase experienced over the last 14 months.
Other easy ways to cut your home insurance costs include joining a neighbourhood watch campaign, which could shave up to 5% off your premiums, and avoiding add-ons such as accidental damage cover that can push the overall price up by 25%.
Most home insurers will also now ask if you are a smoker due to the increased fire risk in properties housing people who smoke. Consequently, giving up the fags could help to bring the cost of insuring your home down to a more reasonable level too.
As your no claims discount will rise every year that you do not make a claim, it is also a good idea to limit the number of claims you make to a minimum.
There are two ways to do this. Firstly, by taking sensible precautions to prevent having to make a claim, such as changing the locks when you move into a new house and fitting a smoke alarm.
Secondly, you can also maintain your no claims discount by covering the cost of repairing minor issues with your own cash.
However, perhaps the easiest way of all to keep your home insurance costs down is to shop around for the lowest quote – while remembering to check the level of cover is sufficient for your needs – using moneysupermarket.com.
Owens added: “We strongly urge anyone looking for a home insurance policy to shop around using a comparison website and ensure that they aren’t paying over the odds for their cover.
"The average saving for consumers using moneysupermarket.com to buy their home insurance premium is £127."
Please note: Any rates or deals mentioned in this article were available at the time of writing.