Home insurance risks and pricing
Insurance companies use risk-based pricing to determine what premium you should pay for your home
insurance. They look at a whole range of factors when setting your premium including your personal
details, the location and postcode of the property, the construction of the walls and roof, the
rebuild cost and what security measures are in place.
Why is security important to my insurance company?
Increasing the security on your property will be looked upon favourably by insurance companies as
it lowers your risk of making a claim. As such, many insurance companies will offer a discount on
your premium if you have a well secured home. Security measures that may result in a discount include:
- A professionally fitted and maintained burglar alarm system
- Membership of an approved Neighbourhood Watch Scheme
- Approved security locks on windows and doors
Some property owners may live in areas that insurance companies consider high risk, such as city
centres, and therefore may insist on certain security measures being in place before providing cover.
Some insurance companies or brokers will be able to provide you with a list of measures you can
take to make your property more secure, and as a result help you to get a cheaper quote.
In the event of a claim your insurance policy can help put things right, but it cannot compensate
for the upset and inconvenience. Take all the precautions you can to prevent the worst from happening.
What is subsidence and what should I look out for?
Subsidence occurs when there is a downward movement of the ground that supports a building. It can
happen for a number of reasons such as a property being built on clay soil, trees taking the moisture
out of the soil surrounding a property, water leaks that wash away the soil beneath a building's
foundations and landslip.
Insurance policies usually cover subsidence but you should check your policy terms and conditions to
see if there are any limitations on your cover. Your insurance company will want to know as soon
as you suspect you may have a subsidence problem so we have put together some information to help
you identify any issues.
The first obvious sign of subsidence is the appearance of cracks. However, not all cracks indicate
that there is a problem. Most buildings shift and settle at some time and there is no need to be
alarmed by every crack that appears.
Cracks are common in new properties and newly built extensions. They are likely to be the result of
the building settling under its own weight. These are usually nothing to worry about, nor are fine
cracks that often appear in newly plastered walls. Buildings shrink and swell naturally due to
changes in temperature and humidity, which can lead to minor cracks where walls and ceilings meet.
These too are not normally anything to worry about.
What should be looked out for are small, usually diagonal, cracks which suddenly appear in plaster
work inside and outside bricks at weak points, such as around doors and windows, especially after
long periods of dry weather. These may, but not necessarily, indicate movement in the building's
foundations. The cracks will normally be thicker than a 10p coin, and usually be wider at the top.
Doors and windows may also 'stick' due to the distortion of the building.
You should expect your insurance company to send out someone to inspect your property if you tell
them you think you have subsidence.
For information relating to flooding, see our separate section
flooding and home insurance.
So how do I get the right home insurance for my needs?
The best way to find the right home insurance cover is to shop around, and what easier way to do it
than using a comparison site like Gocompare.com which allows you to compare quotes and cover from a
large number of insurance companies?
Staying with your current insurance company when your policy is due for renewal may seem to be the
simplest and convenient option but it may not be the cheapest as many companies offer competitive
prices and discounts for new business.
Typical discounts include:
- An introductory discount for new customers
- A no claims discount if you have a number of claim free years
- A discount for purchasing your buildings and contents insurance policies together
Insurance companies will also assess your level of risk and you may qualify for extra discounts if you:
- Live in a neighbourhood watch area
- Live in a property that has a burglar alarm
- The property has approved locks fitted to external doors and windows
Here at Gocompare.com we focus as much on the cover as we do on the price, so by using our special 5
star rating system you can find the policy that provides the right level of cover for your needs – at
the right price.
Is there any reason why I shouldn't just accept the cheapest quote?
The cheapest quote may not provide the right level of cover for your needs, meaning that while you may
save money on your premium you could be left out of pocket later on if you do need to make a claim. By
paying a little extra for your insurance it is usually possible to secure better cover and therefore
get better value for money.
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