Cost of home insurance continues to fall
The cost of home insurance has continued to fall for the first quarter of 2015 with an average combined building and contents policy now costing 79 pence a day – less than the price of a takeaway coffee – the Association of British Insurers (ABI) said today.
Figures from the ABI’s latest Quarterly Average Household Premium Tracker* show:
- The average annual premium paid for a combined buildings and contents policy was £287, or £5.52 a week. This is down 1% on the previous quarter and down 2% compared with the same quarter last year.
- The average annual premium paid for buildings insurance was £225 or £4.33 a week. This is a reduction of 3% compared with the last quarter of 2014, and also down 3% on the first quarter of 2014.
- For contents only insurance, the average annual premium paid was £118, or £2.27 a week. This is down 5% on the final quarter of last year and is 8% lower than the first quarter of 2014.
Mark Shepherd, the ABI’s General Insurance Manager, said:
“The scale of loss people suffer if their home is flooded or catches fire can be almost unimaginable. Some families lose not only the roof over their heads but also most of their personal possessions in a matter of minutes. When the worst happens, home insurance is a life-line.
“The cost of this vital protection has continued to fall, meaning people can on average insure their homes and belongings – and give themselves peace of mind – for less than the cost of a cup of coffee a day.
“The average insurance pay out for a home flooded during the 2013/14 winter floods was around £30,000. In the aftermath insurers dealt with 18,700 claims for flooding and nearly 450,000 for storm damage. Claims costs for other perils can also be very high, with an average claim for domestic fire damage of £11,000. Despite this, the expertise of insurers in planning for such events and competition within the sector is ensuring millions of families can benefit from affordably priced protection for their home and their possessions.”
Notes for Editors
* The Quarterly Average Household Premium Tracker gathers information from ABI members, who represent 90% of the UK home insurance market.
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1. The ABI is the voice of the UK’s insurance and long-term savings industry. It has over 250 members, who together account for around 90% of premiums in the UK domestic market.
The ABI’s role is to:
– Be the voice of the UK insurance industry, leading debate and speaking up for insurers.
– Represent the UK insurance industry to government, regulators and policy makers in the UK, EU and internationally, driving effective public policy and regulation.
– Advocate high standards of customer service within the industry and provide useful information to the public about insurance.
– Promote the benefits of insurance to the government, regulators, policy makers and the public.
The UK insurance industry is the third largest in the world and the largest in Europe. It is a vital part of the UK economy, managing investments amounting to 25% of the UK’s net worth and contributing the fourth highest corporation tax of any sector. Employing around 315,000 people in the UK alone, the insurance industry is also one of this country’s major exporters, with 28% of its net premium income coming from overseas business.
Insurance and businesses protect themselves against the everyday risks they face, enabling people to own their own homes, travel overseas, provide for a financially secure future and run businesses. Insurance underpins a healthy and prosperous society, enabling businesses and individuals to thrive, safe in the knowledge that problems can be handled and risks carefully managed. Every day, our members pay out £147 million in benefits to pensioners and long-term savers as well as £60 million in general insurance claims.
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3. More news and information from the ABI is available on our web site, www.abi.org.uk.