Stop insurers walking all over you!
Time to get savvy with your cover
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% too much. So it’s crucial that you shop around. It may be the cheapest, but rarely. Follow my five steps to getting the right deal:
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 disputes between firms. Buildings insurance is only usually needed by freeholders, not renters or leaseholders. You only need to insure the rebuild cost – how much it would cost to rebuild – 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. Many insurers have online calculators – see my detailed guide at moneysavingexpert. com/homeinsurance.
Step 2: Don’t just use one comparison site – combine them
Comparison sites are quick and easy for cheap quotes. But in truth they’re not actually comparison sites, but marketplaces. They can have special deals and prices with different insurers (but should never be more expensive than going direct). The best thing to do is to combine a few to get a spread of insurers and prices.
Step 3: Check insurers that comparison sites miss out
Two of the big insurers, aviva. co.uk and directline.com are not on comparison sites, so check separately, especially when they have discounts. Also, there can be special promo deals that aren’t on comparison sites. Check for deals on moneysavingexpert. com/homeinsurance.
Step 4: If you want to stay put, haggle
Once you’ve found a cheaper policy, try taking the price to your existing provider and ask them to match it. In a recent poll I did, 76% of customers who haggled with Direct Line said they had success, while 89% did with Admiral and 75% with Hastings Direct.
Step 5: If you’re switching, check for cashback
Once you know your cheapest policy and you’ve checked it’s right for you, see if you can earn cashback with a site such as topcashback.co.uk or quidco.com. The sites pay you if you click through their website and buy something – including home insurance. On occasion, the cashback is bigger than the cost of the insurance, like John* who emailed in, ‘I have paid £32 and I have £55.55 cashback confirmed, so I should have £23 profit.’