Home insurance still ‘competitive’ despite flooding and tax hikes
The industry body said premiums remain ‘competitive’ and have in fact fallen to the lowest quarterly average since the start of 2012.
The cost of the average combined buildings and contents home insurance policy was £310 in the first quarter of 2016, down £4 on the previous quarter, and unchanged from the same period in 2015.
Home insurance premiums traditionally fall in the first quarter, but this reduction comes despite the severe flooding last December and early this year that led to insurers dealing with nearly 10,000 claims from flooded homeowners, and the introduction, last November, of the increased rate of Insurance Premium Tax at 9.5%.
The average buildings-only policy cost £255, with the average contents policy costing £136. Both were virtually unchanged from the previous quarter.
James Dalton, the ABI’s director of general insurance policy, said: “Homeowners are rightly making the most of a very competitive home insurance market by shopping around for the best deal.
“The severe flooding last winter highlighted why home insurance is so important, and the work continues to help those most badly affected get back in their homes as soon as possible.
“For competitive home insurance deals to continue, it is imperative that there are no further government increases to Insurance Premium Tax. As well as a roof over their heads, for most people their home is their biggest asset, so any moves that would further increase the cost of home insurance must be avoided.”