Top tips for cheaper home insurance

Save when you buy

Finding a cheap home insurance quote can seem like a challenge. But there are plenty of tips that could help lower your premium without compromising on the cover you need.

Remember, the cheapest deal might not give you the cover you need or offer the most savings in the long-term. So do your research before committing.

1. Pay annually

Paying monthly is almost always more expensive than paying for your home insurance up front with one lump sum. In fact, it’s estimated that monthly payments increase premiums by around 10% on average.

That’s because, in effect, your insurance provider is ‘loaning’ you the cost of your policy over its term and so charges interest on the amount.

Not every insurer does this, though. Some allow you to spread the cost over 12 months without paying any interest. If you can’t afford the cost of paying the full amount up-front, this might be a deciding factor in which policy you choose.

2. Buy buildings and contents insurance together

You can choose to cover your buildings and contents insurance in one policy, or buy separate policies that cover just the building or just the contents.

If you need both buildings and contents insurance, it usually works out cheaper to buy them together, in a bundle, from one provider - as our research on the costs of home insurance shows.

Insurers usually offer discounts on combined policies. And it also makes things easier if you have to make a claim for something that’s affected both your home (the building) and its contents - such as a fire or flood - as you only have to deal with one insurer.

You’ll also only have one renewal to manage when the time comes.

3. Increase your voluntary excess

The voluntary excess is the amount you agree to pay towards a claim in addition to the compulsory excess set by your insurer.

If you choose to pay a higher amount of voluntary excess when you take out home insurance, you might get a cheaper premium.

Always make sure that you set the voluntary excess at a sum you'd be able to afford if you needed to make a claim though.

Find out more about home insurance excess.

5. Only pay for what you need

When you compare home insurance quotes, you need to declare your home’s rebuild cost and the overall value of your household contents.

Getting these costs right will mean you’re not over-insured or under-insured. Overestimating the costs could mean you’re paying more than you need to be, for cover you don’t need.

To value your home’s contents, you should go from room to room, totting up how much everything in your home is worth. Our contents insurance calculator can help you keep a tally of the costs of your possessions.

Buildings insurance covers you for the cost of rebuilding your home from the ground up - not your home’s current market value.

There are a few ways to find out the rebuild value of your home for insurance purposes.

If you’ve recently bought the property, you can find its rebuild costs on your mortgage valuation or the deeds to your home.

If not, try the residential rebuilding cost calculator from the Building Cost Information Service (BCIS) and Association of British Insurers (ABI) to work out what your home would cost to rebuild. The figure includes the cost of demolishing and clearing away the property and rebuilding it to its existing design and spec.

If you buy a packaged product, you might have cover thrown in that you don’t need – you'll end up paying more for these extras so remove them if they’re not needed.

5. Build a no-claims discount

A no-claims discount (NCD), or no-claims bonus, is a reward for not claiming on your home insurance. If you go a full 12-months without making a claim, you get money off your next year’s cover. The more years you go without claiming, the bigger the discount.

If you make a claim, you can lose your no-claims bonus. In some cases, if you're thinking about making a small insurance claim, it might work out better in the long run to pay for repair or replacement costs yourself and to keep your no-claims discount intact, especially if you have to pay a big excess anyway.

6. Look out for admin charges

Insurers may charge you administration fees for making changes to your policy details, such as a change in Direct Debit instruction if you switch banks, or to add or remove cover.

These charges should be detailed in your policy booklet, so make sure you’re aware of them. In some cases, paying a small amount more for a policy that charges less admin fees might save you more in the long run.

It’s important you do keep your insurer informed of any changes in circumstances - neglecting to do so could invalidate your policy.

7. Take care of your home

Insurers will want to know how well your home is maintained to work out the risk of insuring you.

Keeping your home in good condition means you’re less likely to make a claim - so this could affect the cost of your insurance.

Be sure you protect your home from weather damage. Check for loose roof tiles, broken guttering and keep an eye on the condition of your windows.

And make sure pipes are well insulated so they don’t freeze and burst in cold weather and cause leaks and floods.

Having large trees near your home could increase your premiums because they can cause damage from broken branches, heave or subsidence.

Keep them maintained, or chop them down (provided they're not protected by a Tree Preservation Order) if they become too much of a problem.

If you’re considering home improvements, remember that you may need to contact your insurer before work begins and you should think about reassessing your cover levels when the job is complete.

8. Improve your home security

Your insurer will want to know if you’ve got adequate security on your property.

Things they might consider are:

• Approved locks on external doors
• Key-operated locks on windows
• Installation of an approved burglar alarm
• Security lighting
• Time-switch lights for when the property is unoccupied overnight
• Protection against house fires

If you’re thinking about installing more security, check with your insurer for approved brands and devices.

In some cases, installing security measures - such as an approved alarm system - can mean cheaper premiums.

Work out whether the cost of the equipment will outweigh the savings you’ll make.

Your insurer may also require that you have your alarm system checked annually, so read your policy documents carefully.

Fit at least one smoke alarm on each floor of your home. As well as being a valuable safety precaution, it could bring your premiums down.

Your insurer might ask if you’re a smoker. Don’t lie to get cheaper rates – it could invalidate any claims you make.

10. Join a Neighbourhood Watch scheme

If you live in an area that's covered by a Neighbourhood Watch scheme, and are an active member of it, you might qualify for a discount on your home insurance. That’s because there’s some evidence that crime rates are lower in areas where these schemes run.

You can find schemes close to you on the Neighbourhood Watch website as well as details on setting up your own.

A simple phone call to your insurer to let them know you’re part of a Neighbourhood Watch scheme could see you rewarded with lower premiums.

11. Avoid business use of home

If you work from home on anything other than an occasional basis, you'll need to let your insurer know.

You might have to pay more for your cover in certain circumstances, such as if:

• You keep business stock at home
• You have visitors to your home for business meetings
• You’re offering services from your home such as hairdressing, personal training or dog-grooming
• You’ve adapted your property or an outbuilding into office space.

Insurers differ in what they consider business use, so it’s best to contact your insurer if you’re unclear.

If you are an office-based worker and have to work from home due to Covid, your home insurance premiums probably won’t increase. Your business equipment (such as a business laptop) should be your employer’s responsibility, but do check.

12. Who you live with

Other people living under your roof can have an impact on the premium you pay.

If, for example, a resident has a criminal record, it can push up the cost of your policy. That’s because insurers see people with convictions as a greater risk.

13. Where you live

Where you live will be a major determining factor in the price you pay for a policy.

This could be for any number of reasons including:

• High crime rates in the area
• A history of flooding
• Subsidence in the property
• Construction from non-standard building materials
• If it's a listed building

Insurers use risk to calculate your premium cost so it makes sense that properties or areas with increased risk are likely to face higher premiums.

14. Haggle

After you’ve run a quote, it could be worth calling a few different insurers to see if you can haggle the price down.

15. Never auto-renew

Letting your insurance auto-renew can be pricey. Repeat customers almost always pay more than new customers in a practice known as ‘price walking’. This is where many insurers increase prices for existing customers every year at renewal while offering below-cost prices to attract new customers.

New Financial Conduct Authority (FCA) rules, coming into effect on 1 January 2022, will stop firms ‘price walking’ and ensure that renewal quotes for home insurance consumers are not more expensive than they would be for new customers.

You can still benefit from shopping around or haggling with your current provider at renewal though.

Compare policies annually to make sure you’re getting a great deal.