The average cost of home insurance rose by 31% from January to March 2024 compared to the first quarter of last year, according to Compare the Market.
The comparison site's latest data based on quotes found people living in bedsits currently pay the most and homeowners living in Northern Ireland saw the biggest annual increase in the first three months of 2024.
More expensive premiums means it's vital to choose the right policy for your circ*mstances. Here, Which? takes a closer look at what’s behind premiums soaring and gives tips on how to find the best cover.
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What's happening to home insurance prices?
The average combined buildings and contents policy was £209 in the first quarter of 2024 – that's £53 more than in 2023 and up by £16 compared with the previous quarter. There are a number of reasons for the big increases homeowners have seen over the last year.
Firstly, the rising cost of materials and labour needed for repairing and rebuilding damaged homes have pushed up the cost of settling claims. Figures from the Association of British Insurers (ABI) revealed the value of claims being paid out by insurers, jumped by nearly 10% to £2.55bn in 2023.
Extreme weather also triggered more payouts last year. Last autumn saw storms Babet, Ciaran and Debi batter the UK and led to the value of weather-related damage claims reaching £573m. This is the highest on record and 36% greater than the £421m paid out in 2022.
Payouts for flooding totted up to £286m and represented half of all weather-related claims. A further £153m of weather claims came from burst pipes, most of which happened in the first three months of 2023 at the tail end of a cold winter.
If you were unlucky enough to be affected by the wet weather last year, you'll likely see the cost of insuring your home rise.
Compare the Market data for the first quarter of 2024 found home insurance for properties that have previously flooded were on average £245, or 117%, more expensive to insure than homes that have not previously flooded. Typical insurance premiums for the former rose to £454 in January to March this year.
- Find out more:does home insurance cover flooding?
Bedsits are priciest properties to insure
The type of property also has an impact on premiums.
The comparison site found that while premiums increased for all property types in the first three months of 2024, bedsits were the most expensive to insure. The average cost of cover for these smaller homes was £423. Bedsits also saw the largest annual increase in premiums, rising by 41% from £301 in 2023.
Flats were the second most expensive property type to insure, costing an average of £221. Premiums for these home rose by 36% year-on-year from £163 in the first quarter of 2023. It was the second largest increase.
Bungalows are currently the cheapest to insure, with the average policy costing £199 between January and March 2024. Owners of houses and maisonettes also pay less – £210 and £214 respectively – but none of these properties have escaped home insurance premium rises, with all seeing increases of over 30%.
- Find out more:best home insurance
Where you live also makes a difference
The location of your home affects the price as well.
The table gives a breakdown of home insurance costs by UK region, comparing average premium prices in the first quarter of 2023 with the same three months in 2024. Data is ordered by annual increase – lowest to highest.
| Region | Average premium: January to March 2023 | Average premium: January to March 2024 | Increase |
|---|---|---|---|
| East of England | £144 | £175 | 22% |
| Yorkshire and The Humber | £293 | £366 | 25% |
| North East | £133 | £169 | 27% |
| West Midlands | £145 | £185 | 28% |
| North West | £146 | £189 | 29% |
| Wales | £148 | £193 | 30% |
| East Midlands | £149 | £193 | 30% |
Source: Compare the Market
Northern Ireland was the second most expensive region to insure your home, with the average premium hitting £383 in the first three months of this year. It also saw the biggest year-on-year increase of 53%, up from £250 in the first quarter of 2023.
Homeowners in the North East currently pay the least – £169. That's still a 27% increase on the first quarter of last year, when the average cost was £133.
The East of England, on the other hand, saw the smallest annual rise of 22%, climbing from £144 in the first quarter of 2023 to £175 at the beginning of this year.
Ways to keep costs down
The cost of home insurance may be rising, but there are several ways to mitigate any premium price hike:
1. Shop around
This should always be your starting point. But with so much choice, it can be hard to decide which insurer is right for you.
Price comparison sites that allow you to view multiple quotes at a glance are a good place to start. The main ones for insurance are Compare the Market, Confused.com, GoCompare and MoneySuperMarket.
To get a clearer idea of how different home insurance policies compare, you could also take a look at our guides on the best contents insurance and best buildings insurance. We've rated policies from dozens of insurers to help you choose the right cover.
2. Don't automatically renew
Never agree to the auto-renewal clause included in your 12-month home insurance agreement. This means that once your initial one-year contract lapses, you will be automatically enrolled for another year.
Instead, use the best quotes you've gathered to negotiate with your insurer and take your new business elsewhere if it doesn't improve its offer.
3. Renew early
If you leave arranging home insurance until the last minute, generally speaking, insurers are likely to charge you more than if you purchased the cover a few weeks in advance of the cover starting.
Try buying your insurance weeks (rather than days) ahead of the policy going live.
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