Home insurance renewal
Home insurance renewal
When it comes to updating your home insurance policy, how many times have you let your home insurance auto-renew without even thinking about it? It might seem like the easier option but, by asking yourself some of these questions, you could save money in the long run!
Does my home insurance still provide me with the right amount of cover?
Just because a home insurance policy was adequate 12 months ago, doesn’t mean it’s still fit for purpose when it’s time to renew. Life moves on, and if the value of your home and its contents increases or decreases, you could find yourself either underinsured or paying over the odds.
How much will my home insurance renewal cost me?
The average weekly cost of home contents insurance is now £2.40 a week - less than the average weekly spend on takeaway meals. Yet, one in four UK households have no contents insurance protection, according to the Association of British Insurers. The cost of home contents insurance now stands at a record annual low of £127 a year, according to the ABI’s Home Insurance Premium Tracker published in February 2019. The figure stands at its lowest since the ABI started collecting the data back in 2012.
Looking at our own figures, 50% of people could achieve a quote of £142 per year for their buildings and contents home insurance based on Compare the Market data in February 2020**.
Is home insurance auto-renewal easier than switching providers?
Yes, it’s easier. But it’s likely to be much more expensive too. Until recently, it was tricky to compare last year’s premium with the auto-renewal price. But according to new rules from the Financial Conduct Authority (FCA), insurance providers must now include the cost of last year’s premium on your renewal letter.
“In any market where there is regular switching and fierce competition for new business, good deals are available to those who shop around but this does mean long-standing customers can lose out," said the ABI Director General Huw Evans.
So it’s easy to check how much your price has changed. Even if it has decreased it’s still worth shopping around because if your provider has decreased your price, others likely will have too.
When is the best time to renew home insurance?
According to research, you could save up to 20% on your home insurance premium by comparing quotes three weeks ahead of the start date.
What should I consider when I renew my home insurance?
Some of the key things to think about ahead of renewal are whether any of your household contents could have depreciated or increased in value – or if you’ve bought any new items over the past 12 months.
Valuable family heirlooms, like jewellery or antiques, might increase in value over the course of a year. And a high-value item may need to be individually specified on an insurance policy if it exceeds the ‘single article limit’.
The single article limit is the maximum value that any one item can be worth before it needs to be added individually to the policy. What that limit is will depend on the policy, and it can vary from £1,000 all the way up to £15,000. So, for example, if the single article limit on your policy was £1,500 and your engagement ring was worth twice that, you’d need to tell your insurance provider (and probably pay a bit more to get it insured).
Also, think about things like new sofas, beds or even a wedding dress. You’ll want to protect all of these, so make sure your policy reflects the item’s value.
But it’s not just the stuff inside your home. Have there been any external upgrades to your house – a conversion or an extension? Physical changes to your home will also need to be taken into account. On a more personal note, if you’ve had a child or even got a dog or a cat in the past year, you should let your insurance provider know so they can update your policy accordingly.
How can I make sure I get my home insurance renewal right?
The main thing to consider is whether the policy that’s up for renewal accurately reflects your home as it is right now. Be honest with yourself about whether anything’s increased in value and is therefore likely to push up premiums. If it comes to making a claim, you’ll be grateful that you’ve got the right cover in place. Similarly, don’t pay more than you have to by forgetting to take depreciation into account.
Your home insurance isn’t about finding the cheapest deal – it’s about finding the right deal for your circumstances and the level of protection you want. And if you’re stuck and really don’t know what you should be looking for, take a look at our home insurance hub.
So, how much could I save by comparing the market?
When you search for home insurance with us, you can be confident about getting a policy that suits both your needs and your pocket. Half of our customers could save up to £105***, and 10% could save up to £312****. So, before you auto-renew, shouldn’t you start comparing?
**50% of people could achieve a quote of £142.00 per year for their buildings and contents home insurance based on Compare the Market data in February 2020.
***Based on Online independent research by Consumer Intelligence during February 2020 50% of customers could save up to £105.35 on their home insurance premium.
****Based on Online independent research by Consumer Intelligence during February 2020 10% of customers could save up to £312.69 on their home insurance premium.