Home insurance premiums hit record high

New data has found that households in the UK are facing the largest increase in home insurance premiums on record, with extreme weather events being a major factor.

Quoted premiums have risen by 41.6% over the past year, the highest annual increase in a decade. While quoted premiums now average between £150 and £199, the true average cost is closer to £400. This marks the steepest annual rise since Consumer Intelligence began monitoring quoted premiums in 2014.

According to Consumer Intelligence, the trend shows no signs of slowing, as quoted premiums for buildings and contents insurance jumped by 10.3% in the last three months as well – the highest quarterly increase in a decade.

Consumer Intelligence’s data indicates that the most common premiums are between £150 and £199, with 24% of quotes falling within this range. Notably, those who have recently reported thefts saw their quoted premiums rise by 13.8% in the past three months.

Over the 12-month period to April, policyholders with buildings claims experienced a 50.3% increase, while those with water damage claims saw a 49.8% hike. Theft-related claims led to a 43.7% climb; other damage claims, 46.4%. In contrast, customers with no claims saw a 40.9% adjustment.

Across different regions, every area saw an uptick in quoted premiums over the past year, ranging from a 49.9% jump in London to a 37.6% rise in the North West. In the last three months, increases varied from 7.4% in the West Midlands to 14.5% in London.

Matthew McMaster Senior Insight Analyst at Consumer Intelligence said The increase in building and contents insurance new business quoted premiums is the largest yearly increase we have seen since tracking began in 2014,” noted  “The market saw inflation during each of the last 12 months, and the last three months was the highest recorded in the last 10 years exceeding the 10% in Q3 2023.”

Since Consumer Intelligence started collecting data in February 2014, quoted premiums have escalated by 68.8%.