Buildings Insurance went up again last year, costing homeowners another 1% a year, taking the average to just over 205 for a year’s insurance. Contents insurance also went up, this time by 2% – now it costs the average homeowner 151 a year. However, some lenders are hiking prices even higher than that Norwich Union for example, raised its prices by a whopping 6% last year.
The question is – why? There’s so much competition out there, you’d expect prices to be falling, not increasing but there are other forces at work, as we go on to discuss.
No 1 the cost of having a house repaired or rebuilt
Labour and building materials are getting more costly, so when the insurance company calculates how much it would cost to rebuild your house, prices are higher. This is due to inflation, and the same thing affects the insurance company and its own operating costs. Wages, bills, office rental all these costs are increasing year on year so of course insurers have to factor these in.
No 2 the weather
The British weather is getting more and more tempestuous, whether it’s due to global warming we are not qualified to...
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