Home Insurance on the Rise… Time to Shop around

Home insurance premiums have been climbing steadily, and it seems the trend is set to continue into 2025. Several factors are driving this increase:

• • • • • • • • • • • • • Supply Chain Pressures: Ongoing disruptions have made repairs and replacements more expensive, pushing up claim costs.

                        • Inflation: While insurers initially held off on raising premiums during the 2022 inflation surge, they eventually had to adjust prices to remain sustainable.

                        • Increased Claims: A rise in the frequency and severity of claims, often linked to extreme weather events, has added to the financial strain on insurers.

It’s been another difficult year for insurers and consumers due to supply chain pressures, an increased number of payouts and a rise in the cost of claims. In Q2 2024, the cost of an average home insurance policy reached £396 – nearly a fifth higher than the previous year. It is expected that, over the course of this year, the average premium will have risen by 19%. Experts have reflected that, when inflation surged in 2022, insurers wanted to keep their prices competitive so did not initially increase their premiums. However, it eventually became necessary to put their prices up, hence why many policy holders are feeling the pinch now. *EY, 2024

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