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When comparing your home insurance costs you’ll typically be given two payment options – pay the total balance up front or spread the payment over monthly instalments. But which is better value?
You'll typically save money by paying for your insurance annually as opposed to monthly. Annual payment has pros and cons though, so you should consider whether it’s suitable for you. Pros: Save money – paying for home insurance in one lump sum is typically cheaper than paying through monthly instalments. Insurance providers often charge interest on monthly payments, so you’ll pay back a little more than if you paid upfront. Have more choice – not all insurance providers allow customers to pay monthly (although most do), so by choosing to pay your home insurance annually you might get to pick from a few more deals.
Enjoy more convenience – if you pay for your home insurance annually you’ll make one payment and that’s it for the year.
Cons:
Upfront payment – you'll need to pay a lump sum for the year all at once, and you might not have the spare cash. Harder to budget – you need to make sure that you have enough to pay for another year when your annual payment runs out.
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The major advantage of paying for your home insurance monthly is that you can spread the cost over manageable payments. This can make household budgeting easier as you can add the amount to your monthly outgoings.
Whether you think you want to pay for your home insurance annually or monthly, it’s always a good idea to compare prices. It’s simple with Compare the Market – compare home insurance now.
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