13:12 21 March 2013
It's not very nice having to pay for something you hope you'll never have to use, like home insurance. But it's one of those things in life you can't really do without, so it's vital that you never pay a penny more than you have to for it.
If you're a bit clever with it, you could save as much as £200 on your home insurance, which is money that could be spent much better elsewhere, or added to your savings.
If you've a renewal coming up, or you're buying home insurance for the first time, here are five ways to pay less for your cover.
1. Shop around
This is the golden rule. If you do nothing else, make sure you shop around to see who's offering the best price and, if you're renewing, how their prices compare to your insurer's renewal quote.
Your insurer isn't going to reward your loyalty with cheap cover. In fact, they're more likely to offer cheaper cover to new customers so that they can get more people on their books. But you can use this knowledge to your advantage by always being a 'new customer' and switching to a new provider each year.
Our home insurance comparison service will give you more than 95 insurers to choose from. It only takes a few minutes to get a huge list of quotes, and with our calculators you can get an accurate valuation on your contents and your home's rebuild value.
What's more, with a few clicks you can add or remove policy features like home emergency cover, personal possessions cover and accidental damage cover to see how it affects your premiums.
Just think how long-winded that would be if you were to phone several insurers and get the quotes manually!
MoneySupermarket is an independent company and not owned by an insurer, so you can be sure that you're getting the best price for you and a set of quotes aligned to your needs.
2. Combine buildings and contents cover
If you could pick up your house and shake it, everything that fell out, including furniture, clothing and electricals, would be covered by contents insurance. Everything left in your hands, including its structure, permanent fixtures and even built-in appliances, would be covered by buildings insurance.
Many insurers will give you a discount if you get both your contents and buildings insurance from them. In some cases the discount can be as much as 40%.
From an admin angle it'll probably also be easier to handle in the event of a claim, or even if you just have questions, as you'll only have to deal with one company. You may also find it easier to compare prices come renewal time next year.
3. Increase your security
The harder it is to break into your home, the less likely it is you'll be burgled and have to make a home insurance claim, so increasing your security should bring your premiums down.
The Association of British Insurers (ABI) says you're 10 times more likely to be burgled if you don't have basic security, and even something as simple as putting strong locks on your doors and windows will help.
The ABI does a comprehensive run-down of how to best secure your home here, detailing everything from what types of locks to use to keeping your home secured while you're out.
Even just installing a burglar alarm can bring your premiums down by up to 7.5% and joining a Neighbourhood Watch scheme can bring it down by a further 5%.
4. Excess, instalments and No Claims Discounts
Increasing your voluntary excess (the amount you volunteer to pay to get a claim started, on top of the policy's compulsory excess) will bring down your premiums. The more you volunteer to pay, the more your premiums should come down.
But be realistic because you will have to pay it in the event of a claim - so there's no point volunteering to something you can't actually afford.
Paying for cover in monthly instalments might make home insurance more affordable as you don't have to front the cash in one go - but it is the more expensive option. As you're essentially borrowing the money for the policy and paying it off over the course of the year, the insurer will load the price with what essentially amounts to interest.
If you can, pay for the policy up front rather than in instalments and you'll save money.
Like car insurance, the longer you go without making a claim on your home insurance, the more No Claims Discount (NCD) you'll accumulate, which will bring your premiums down.
This highlights the importance of good home security because not only will it keep intruders out, it'll preserve your NCD and save you money over the years to come.
5. Only pay for what you need
Home insurance policies are sold with a whole host of optional extras, but you're not obliged to buy them.
In many cases, things like legal expenses cover and home emergency cover can be very useful, but you need to weigh up how much extra they'll cost you and whether they represent good value.
As I wrote in my article Are bells and whistles on your home insurance policy worth the cost?, a good savings plan can be just as good a defence against things like boiler breakdowns, and even if you don't have to touch your savings - the money will be in your account rather than an insurer's coffers.
Some insurers will even push identity fraud cover, which can be completely redundant thanks to The Banking Code which should protect you as long as any money lost though identity fraud wasn't caused by your own negligence.
Investing in a decent shredder may be a better option.
These optional extras are not a waste of money, some are genuinely useful, but before you buy you should read the policy wording carefully to see just what they will cover you for and think about whether you'll be doubling up on cover elsewhere.
For example, some contents insurance policies automatically cover accidental damage to home entertainment equipment, so you might not want to double-up by buying accidental damage cover as an optional extra.
So there you are, five ways to save money on home insurance cover, on the house.
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