Home insurance with 'high value' items rises to £302 - how to cut costs by £176
The average cost for home insurance cover that includes "high value items" has skyrocketed over the last year.
Home insurance has become more expensive over the last year with the typical cost of all home insurance policies rising by £46 between December 2022 and November 2023 according to figures from ComparetheMarket.com. However, home insurance premiums which cover high value items have increased even more by around 24% - or £58 - over the last 12 months taking the average policy from £243 to £302.
Adding high-value items to a home insurance policy will usually increase the cost of the premium. Compare the Market’s figures show a home insurance policy that includes cover for high-value items is £108 more expensive than a policy that doesn’t specifically protect any high-value items.
High-value items, usually worth more than £1,500, should be specifically declared on a home insurance policy to ensure they are fully protected. The most common high value items include jewellery pieces and watches, computer equipment and musical instruments.
Compare the Market says the increase in home insurance premiums is potentially due to a rise in the cost of claims for insurers as higher inflation has made it more expensive to repair or replace items.
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Alongside this, the average value of many expensive items has also increased due to inflation with the typical value of a high value item now sitting at £3,919 - up from £3,877 in 2022. Due to the increase, homeowners are shopping around more to find the best deal for them.
Compare the Market says the searches for home insurance that specifically covers high-value items have surged by 55% in the past twelve months. The price comparison site says homeowners can potentially cut their home insurance costs by up to £176 by shopping around.
However, it site warns that high inflation means some possessions may now be worth more than the single item limit on some home insurance policies which means it will only partially cover the cost of a replacement - this means people need to
Helen Phipps, home insurance expert at Compare the Market, said: “Households should be careful not to underestimate the value of any expensive single items, such as jewellery or a big-screen smart TV when buying home insurance. Most contents policies will have a maximum amount paid out for any one item. It’s often around £1,500 but could be lower or higher depending on the insurer."
"We would encourage policyholders to check the limitations of their cover, for example, items taken out of the home and either lost or damaged could fall under personal possessions cover and may not be covered by the main home insurance policy. Shopping around for the right home insurance policy with the help of a price comparison website could help you get the cover you need at the best price.”
How to cut the cost of home insurance
Home insurance covers you if something bad happens, such as a fire, storm damage or burglary. But what you are covered by depends on the type of policy you take out. There are three main types of home insurance and these are:
- Building insurance - this covers you if something physically happens to the home and will usually cover the cost to rebuild, repair or replace things like your roof, walls, windows, doors or fitted bathrooms and kitchens
- Contents insurance - this covers the possessions in your home such as TV's, ovens, laptops, fridge etc
- Combined buildings and contents insurance - this covers both your physical home and your possessions
Martin Lewis' MoneySavingExpert website says you should look to renew your home insurance 21 days before it is due to expire as this is where the best deals are usually offered.
When getting or renewing your home insurance, you should always look to shop around to find the best deal. Often, if you combine your policies it can work out cheaper. Another way you could make your insurance premium cheaper is by paying annually rather than monthly. Although it is a much bigger upfront payment, it will work out cheaper overall.
You should also consider your policy as there are several extras you can add to your policy that will increase the cost, but you may not really need them. Finally, you should not forget your "no-claims" bonus, if you go one year without claiming with a no-claims bonus you cut your insurance by 10% rising to as much as 50% if you have five years or more without a claim according to GoCompare.com.
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