Quoted Home Insurance Premium Cuts Accelerate as Competition Increases

Quoted premiums fell 13.1% in the past 12 months and by 4.8% in the past three months compared with 3.9% in the previous three months.

Premiums have most commonly been quoted between £150 and £199, with 29% of quotes falling within that range, according to Consumer Intelligence’s data.  In September this year 67.3% of consumers could source quotes for less than £200 compared with 57.5% a year ago.

“More than two-thirds of the most competitive providers cut quoted premiums for combined building and contents policies in the past three months, “said Laura Vas, Senior Insight Analyst at Consumer Intelligence.

“We also saw firms reducing premiums in the buildings-only market more substantially than in the contents-only sector changing the previous trend where the contents-only market saw stronger deflation,” she adds.

Long-term view

Overall, quoted premiums have risen by 46.7% since Consumer Intelligence first started collecting data in February 2014.

Regional Trends

The biggest fall in quoted premiums in the past year and in the past three months was in Wales which recorded a 16.8% drop over the year and a 6.8% fall in the three months.
All regions saw quoted premiums decline over 12 months and three months with nine out of 11 seeing double digit decreases over the year. The smallest fall in the past three months was in the North East at 2.6%  

Age differences

Quoted premiums for under-50s households have fallen 13.7% in the past 12 months ahead of a 12.6% drop for the over-50s.

Over the past three months quoted premiums for the under-50s have fallen 5.1% compared with 4.6% for the over-50s.

Property age

Quoted premiums for properties of all ages have fallen over the past year with the biggest decreases at 16.6% for homes built between 1895 and 1910 and 15.4% for those built between 1985 and 2000.

Prices have fallen for properties of all ages over the past three months as well dropping the most for properties built between 1895 and 1910 at 6.6%.

Data from the Consumer Intelligence Home Insurance Price Index is used by the Office for National Statistics, regulators, and insurance providers as the definitive benchmark of how price is changing for consumers.

¹  For each risk, common to consecutive months, the variation is calculated from the average of the five cheapest premiums returned on each PCW in the previous month to the average of the Top Five in the current month regardless of which brands provided these quotes. The exercise is repeated on each PCW for each common risk. The Overall Market Top Five monthly variation is calculated by averaging across all these risk level Top Five variations for common risks run in both months. The monthly figures are concatenated up to produce the trended price index from a starting point of 100% in the base month.