Last year the UK’s average premium for Buildings Insurance increased by 1% to just over 205 and the average for Contents Insurance rose to 151, up 2%. But within the market we’ve seen some much bigger rises if you’re with Norwich Union you’ll have seen your premium rise by around 6%.
So what’s going on? Every year we see premiums rising. Surely with so much competition in the home insurance market, you wouldn’t expect to see such inexorable rises in premiums?
Let’s consider the situation more carefully.
The cost of repairing and rebuilding houses is a reflection of the rising price of labour and building materials. This means that cost to the insurers of claims under the buildings cover similarly rises. So as their costs rise, so do your premiums. And there’s also the indisputable fact that cost inflation also affects the insurance companies own operating costs. Wherever possible, they’re bound to add a little extra on for that!
Then there’s that lovely British weather. Michael Fish could be forgiven for believing we don’t live in a hurricane zone, but nevertheless it’s a...
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