WHEN something goes wrong, having home insurance can save you thousands of pounds.
But getting yourself covered properly comes with a price tag – and costs have jumped even more under lockdown.
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Home insurance hit a seven-year high last September, with Brits forking out up to £250 a month for cover according to research from MoneySupermarket.com.
Guernsey was the most expensive area for home insurance, followed by Harrow, where you’ll be paying £249 a month on average, and Ilford and Barking at £238.
So how can you beat the rising prices? Here are five ways you can shave hundreds off your bill:
Shop for a combined policy
Save money by getting a combined building and contents policy instead of buying them separately if you own your property.
The average price of a combined policy fell from £154 in 2019 to £152 in 2020 according to Confused.com.
You could be saving around £24 a month, or £288 a year, if you buy a combined policy, instead of buying two separate covers.
The average cost of a buildings-only insurance policy is £111, according to MoneySupermarket, and a policy which only covers you for contents is £65.
On top of that, the money comparison website told The Sun you could save hundreds more if you shop around for a policy.
It said 51% of customers could save up to £104 on a combined policy by comparing quotes.
You can compare deals on its website, or you could also use sites such as MoneySuperMarket.com or Uswitch.
Installing a burglar alarm
Not only will installing a burglar alarm bring you peace of mind, but it could help to cut your home insurance bill.
According to MoneyExpert, your provider may offer you a reduced premium if you have one in place.
How to cut your bills
IF you’re struggling financially, you might be able to cut the cost of your bills to help you get out of the red.
Council tax: You can apply for a council tax reduction on the Gov.uk website but you’ll need to meet certain criteria. Your bill could be cut by as much as 100 per cent if you’re on a low income or claim benefits. Carers who look after someone in the household for at least 35 hours a week are also exempt from paying.
Water: Households might be able to save money by getting a water meter but it all depends on how much you’re using. To check if it’s finacially worthwhile, use the Consumer Council for Water’s free ater meter calculator.
Rent: If you have the space available and your landlord or local authority says it’s ok to do so, you might want to consider getting a flatmate. Not only will you split the cost of the rent, but also the other bills.
Hire purchase: If you’re struggling to make your repayments on your hire purchase, you can usually end the contract by returning the goods. You will have to pay all the instalments due up to the time you end the agreement but this will limit the amount you owe. Contact Citizens Advice for free for more help with this.
Gas and electricty: MoneySavingExpert says families can save £330 on average by switching from Standard Variable Tariffs (SVTs) to a better rate. Use a comparison site such as MoneySuperMarket or Energyhelpline to see what deals are available.
Mortgage: If you get into debt with your mortgage payments, don’t wait for your lender to chase you. Work out what you can afford using the Citizens Advice budgeting tool so you can discuss your payment options moving forward with your mortgage provider.
Secured Loan: Your secured loan might be covered by the Consumer Credit Act and if it is, you may be able to apply for a Time Order. This is a special agreement by the courts allowing you more time to make payments. Secured loans not covered by the Consumer Credit Act include gas, electricity or water meters, payments that need to be written off in full, mortgages, credit union loans, loans from an employer and some short term trade agreements.
County Court Judgements: If you receive a County Court claim form talk to a free debt advice service straight away. This includes Citizens Advice (0808 800 9060), StepChange (0800 138 1111) and the National Debtline (0808 808 4000).
TV licence: Some households are eligible for a reduced fee or free TV Licence. Check here to see if you are entitled to a reduced or free rate.
How much you could save will depend on your provider, so it’s best to check with them if installing one will help lower your bill.
You will have to fork out for the alarm system though – but according to Aviva, the lowest this could cost is roughly £200 if you install it yourself.
Paying your insurance annually
If you can afford to pay your bill all in one go, you’ll be able to save more.
According to Money Advice Service, you’ll usually pay an extra 6% if you’re paying monthly.
The average combined policy, as Confused.com says, costs roughly £152 a month – so you could be saving roughly £109 if you pay it upfront.
Increase your excess
Increasing your voluntary excess is one of the easiest ways to cut your home insurance bill.
Excess is the fixed amount of cash you have to pay out if you make a claim.
So if you put in a claim for £200 in stolen goods if you got burgled and have an excess of £50, you’d receive a pay out of £150.
If you voluntarily make your excess higher, you’ll usually get a discount from your insurer on your premiums.
However, you’ll need to keep in mind that if something goes wrong, you’ll be footing more of the bill in the end – so make sure you calculate whether you can afford to do it.
How much you will save depends on who your insurer is and whether they decide to take some money off your bill.
It’s best to check in with your provider beforehand to see exactly what you could be saving.
Join a Neighbourhood Watch group
You could crack down on crime and your home insurance bill if you join a Neighbourhood Watch group.
You could get 10% off your bill if you sign up to the scheme, as providers assume in most cases you’re less likely to be a victim of a crime.
The average combined policy, as Confused.com says, costs roughly £152 a month – so you could be saving over £18 a year.
But discounts will vary depending on who your insurer is, so it’s best to check in with them to see exactly how much you could save.
We’ve spotted that companies such as LV do not offer a discount.
However, if you make a claim, your insurance provider could ask for proof that you’re a member.
You’ll have to attend meetings and share evidence that you’re part of the group.
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We explain how to check how much your council tax bill is going up by from April 2021.
Households on a low income, Universal Credit or benefits can apply for a council tax bill reduction.
And because of the coronavirus crisis, you might be able to get an extra £150 knocked off your council tax bill.
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