Stop letting home insurance (price) walk all over you

PRICE walking is a clever technique many home insurance providers use to make loyal customers pay more.

Each year if you stick with them they ‘walk’ up the price. After five years or so you can easily be paying more than 50% over the odds.

So ask yourself, when did you last change your home insurance provider? If the answer is more than a year ago, you’re most likely paying a ‘loyalty penalty’ – far more than you’d pay the same company as a new customer. The key five steps to getting the right deal on your home insurance are…

■ STEP 1: Turn your house upside down to define the right cover.

There are two elements to home insurance – buildings and contents. An easy way to work out what’s covered is to imagine turning your home upside down: everything that stays put comes under buildings. If it falls out, it’s contents. A joint policy is often easier as it means no jurisdictional disputes between firms.

Buildings insurance is only usually needed by freeholders, not renters or leaseholders. You only need to insure the rebuild cost rather than the market value. To find your rebuild value, there’s a free calculator at abi.bcis.co.uk.

Contents cover is for everyone. Don’t under insure thinking you’ll never claim the full amount. You often have much more value in your home than you think. Many insurers have useful calculators online.

There’s full help on this at moneysavingexpert.com/homeinsurance.

■ STEP 2: Don’t just use one comparison site – combine them.

Comparison sites are a quick and easy way to find cheap quotes if you’ve relatively normal circumstances. Yet in truth they’re not actually comparison sites, they are marketplaces, as they can have special deals and prices with different insurers (but should never be more expensive than going direct). So the best thing to do is to combine a few of them to get a spread of insurers and prices.

■ STEP 3: Check insurers that comparison sites miss.

Two of the big insurers, aviva. co.uk and directline.com are not included on comparison sites, so check them separately, especially when they have discounts.

■ STEP 4: If you want to stay put, haggle.

Once you’ve found a cheaper policy – you can always try taking the price to your existing provider and ask them to see if they will match it – they often will.

■ STEP 5: If you’re switching, once you know what you’re getting, check for cashback.

Once you know your cheapest policy and crucially you’ve checked IT’S RIGHT FOR YOU, then check if you can earn cashback using a cashback site such as Topcashback.co.uk or Quidco.com.

These sites pay you if you click through them to other companies and purchase something – such as home insurance.

■ Martin Lewis is the founder and chair of MoneySaving Expert.com. Get his free Money Tips email at moneysaving expert.com/latesttip.