Home insurance costs have been steadily rising over the past 12 months, and now stand at £161.87 per year according to the AA, but there are lots of quick and easy ways to cut the cost of your bill. From making sure you’re not left short when you claim, to seeking out the best cashback deals, here are five of the most efficient ways to slash your bill.
1. Loyalty never pays
Insurers do not reward loyalty and if you’ve stayed with the same insurer for a number of years, you’ll probably be overpaying. When your policy is up for renewal, shop around and see what price you would be given if you were a new customer. It’s likely to be a lot less than you’re paying now as there’s often discounts available for new customers.
2. Don’t over or under-cover yourself
If you buy an insurance policy with not enough cover, you could be left short if the worst happened and you needed to make a claim. Similarly, if you are paying for a policy which covers more than you have, you’ll be paying too much. There’s lots of free calculators available which show you exactly how much cover you need, such as this one from the Association of British Insurers (https://abi.bcis.co.uk). Remember, contents policies cover everything inside your house which you could remove, such as sofas, your TV and your computer, while buildings policies cover the structure of your home.
3. Paying monthly will cost you more
Choosing to pay monthly, rather than in one lump sum for the year, is more expensive. This is because insurers add interest to monthly payments, therefore if you can afford to pay the full amount upfront it’ll be cheaper. If you can’t, it might be a better option to use a credit card to pay. However, if you go for this option you need to make sure the interest rate is lower than the rate offered by the insurer, such as with a 0 per cent card, and that you can clear it during that period.
4. Haggle down the price
Haggling can work wonders when it comes to home insurance, and it’s best done at renewal but you could try your luck at any time. Do your research and find out what price you would get as a new customer, then call your insurer and ask it to match the price. If it refuses, you’re free to leave. You could also ask it to throw in an extra freebie, such as free legal cover.
5. Seek out the best freebies and claim cashback
As insurers are desperate to draw in new customers, there’s often discounts and freebies available for new customers. Once you’ve found a policy at the right price, have a look what offers are available to see if you can knock the price down further. The quickest way to check is with a comparison website, although remember some insurers such as Direct Line aren’t listed on them. A cashback website can also save you money. Cashback is paid after three months on most websites, and there are good deals to be had - such as £50 cash back with Aviva if you buy your home insurance through the cashback website TopCashBack.