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Elinor Zuke
By
February 16, 2017

Tax And Exchange Rates 'Will Boost Home Insurance Costs'

home-insurance-price-increase.png

  • Average annual premium rises 1.8% to £124
  • But price rises will build as weak pound boosts cost of repairs and more tax rises kick in

Insurance premium tax rises are driving up the cost of home insurance pushing average annual premiums up 1.8% to £124, new analysis1 from insurance market research experts Consumer Intelligence shows.

 

But Consumer Intelligence is warning more price rises are on the way as the weak pound drives up the cost of repairs and another Insurance Premium Tax rise takes effect in June.

 

Its data  which is used by the Government’s Office of National Statistics to calculate official inflation statistics  shows the last Insurance Premium Tax rise in October is one of the main reasons for the increase in the year to January.

 

The quarterly Home Insurance Price Index shows premiums are rising fastest for over-50s who have seen increases of 3% in the past year to £128 compared with increases of 1% for under-50s.

 

Home insurance customers in the East of England are experiencing the highest increases in premiums with average rises of 4.3% in the past year. Londoners have seen prices fall over the year but still pay the highest premiums at £147.

 

Analysts warn that the weakness of the pound since the EU Referendum is having an impact on building material costs which will increase the cost of repairs and premiums depending on which contractor's insurers use.

 

However, customers can take comfort from the fact that home insurance costs are still 7.8% lower than in February 2014 when Consumer Intelligence first analysed data.

 

John Blevins, Consumer Intelligence pricing expert, said:

 

“The rise in home insurance costs over the past year may just be the beginning once the impact of the weak pound and the next Insurance Premium Tax rise kick in.


“The impact of sterling’s post Brexit slide will feed through from increased costs for building materials and equipment increasing the cost of claims which are the biggest influence on premiums.


“However the impact will vary from insurer to insurer depending on the contractors they use. Competition for business remains intense, so shopping around remains important as there are plenty of insurers who want your business.”


The table below shows average premiums and price rises around Great Britain.

 

 REGION

CHANGE IN YEAR TO JANUARY

AVERAGE PREMIUM (FIVE CHEAPEST)

Eastern

+4.3%

£122

Wales

+3.7%

£117

East Midlands

+3.4%

£115

Yorkshire & The Humber

+2.5%

£128

North East

+2.3%

£117

South West

+2.2%

£112

West Midlands

+1.8%

£118

Scotland

+1.8%

£122

North West

1.3%

£124

South East

+0.9%

£124

London

-0.9%

£147

GREAT BRITAIN        

+1.8%

£124

 


 

COMING SOON FEBRUARY 2017 . . . 

home-insurance-price-index-ebook-1.png

 

Home Insurance Price Index February 2017

Insight that will enable you to optimise your pricing strategy . . .

  • Gain insight into market movements
  • Benchmark the major home insurance brands 
  • Understand the data behind the home insurance cost index results

Request Upcoming Index

 

 


Notes

 

Notes to Editors


 1The cheapest premiums were calculated by comparing the prices offered for 2,100 people by all the major Price Comparison Sites and key direct insurers. The top 5 prices for each person were compared to the previous month’s top 5, then these variations averaged to produce the index.

 

For further information, please contact:

Consumer Intelligence
Elinor Zuke
07863 350270

Citigate Dewe Rogerson
Kevan Reilly / Phil Anderson
020 7638 9571

About Consumer Intelligence
Consumer Intelligence conducts consumer surveys and benchmarks price and service performance providing unique insights into competitor pricing and customer experiences, their attitudes, opinions and behaviours. For more information, visit the web site www.consumerintelligence.com


 

 


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