how to reduce home insurance premiums

Home insurance is a necessary safety net for unexpected and unfortunate situations which could end up costing you a lot. Finding the right home insurance plan is not always as straightforward as you may think, and without the necessary due diligence on your part, you may end up overpaying for a plan that doesn’t cover your needs.

Read on to learn how to find the right home insurance plan and reduce your home insurance premiums.


What types of home insurance are there?

Before we delve into how to reduce your home insurance premiums, we need to explain the two different types of home insurance that are available:

1. Buildings Insurance

Buildings insurance covers the damage to your actual home, and in most cases, fittings and fixtures are also included.

Is buildings insurance a legal requirement?

No. Buildings insurance is not compulsory and it’s not a legal requirement by any means. Conversely, it is usually a condition of your mortgage policy and falls under the landlord’s responsibility rather than the tenant’s. Even though it is not legally required, it is in your best interest to cover your house for possible damages to avoid any unpleasant situation that could take a heavy toll on you financially.

2. Contents Insurance

The other type of home insurance is contents insurance. Contents insurance covers all the personal possessions that are located inside your home. From furniture and electrical appliances to works of art, clothes and jewellery, contents insurance will cover any damage to and loss of your personal belongings.

Is contents insurance a legal requirement?

No. Contents insurance is not compulsory or a legal requirement. Furthermore, if the property is rented out then it’s both parties’ responsibility to buy contents insurance, each for their own belongings.


How to Lower the cost of your home insurance

There are several factors that come into play and affect the rate of your home insurance fees. Whether you are on the market for a new home insurance plan or thinking of changing your current one in the hopes of reducing the monthly amount you are paying, there are certain requirements that are set by insurance companies, that if properly met, will grant you with a discount.

1. Do a market research

People usually tend to stick with their original service provider in order to avoid the inconvenience of shopping around. While that is understandable this should not be an excuse given that fact that you can save a significant amount simply by weighing your available options and checking all the alternatives. Before renewing the contract with your current provider, speak with other insurance agents, go on online insurance comparing websites to receive multiple quotes, and read any consumer guides you can find. Staying informed is a step towards the right direction.

2. Get a monitored burglar alarm

Most Insurance companies offer lower home insurance rates if you own a burglar alarm with an associated maintenance and monitoring plan. Monitored alarms are connected to ARCs (Alarm Response Receiving Centres) that are manned 24/7 by security professionals who, in the event of an emergency, will verify the validity of the alarm activation and take the necessary actions to notify the nominated keyholders and even the Police (based on your monitoring plan). At Banham, we offer high-end alarms with different monitoring plans tailored to the level of response you need.

3. Increase your voluntary excess

The excess on your policy is the amount that you will have to cover in case of a claim before the insurance policy kicks in. If you are willing to pay a higher excess on any possible future claims, it is likely that your insurance company will reduce both your buildings and contents insurance premiums. Bear in mind that should you need to make a claim, you will be obliged to pay the higher agreed upon amount.

4. Choose the right plan

A lot of homeowners and tenants tend to either overinsure ‘just to be safe’ or underinsure to save on premiums when choosing their contents insurance plan. Neither of the aforementioned options is the optimal solution. You should carefully assess the value of your possessions and calculate with your insurance agent their total replacement cost should you need to make a claim.

For your buildings insurance keep in mind that the value insured will be based on the value of rebuilding the property rather than the market value.

Finally, always remember to re-evaluate the contract terms every time you renew your insurance contract to ensure that any changes are properly reflected in your new contract.

5. Install CCTV cameras

Some insurance companies will provide a discount on their monthly rates if the property at hand is equipped with CCTV security cameras since they are considered as an effective burglar deterrent.

6. Consider a combined policy

There is always the chance of achieving a much better deal if you opt to buy both your buildings and contents insurance from the same vendor. Most insurance companies will be more than happy to offer a discount if you get a combined policy. Conversely, sometimes it’s better to receive different quotes for separate policies which accumulatively will add up to less than a joint policy. In any case, you should always shop around to find the best possible deal.

7. Pay annually instead of monthly

Most insurance companies offer discounted rates should you decide to pay annually instead of in monthly instalments.

8. Increase your fire security

Install fire alarms with professionally maintained smoke and heat detectors. Fire risks are one of the most common threats to your property and your belongings. Having a monitored fire alarm will go a long way in reducing your home insurance premiums and providing you the peace of mind knowing that your home is safe.

It is obvious that the amount you have to pay for your home insurance is directly linked with the security measures that you have implemented to your property. British standard 3621 door locks, NACOSS approved monitored burglar and fire alarms, all of these burglary and fire prevention measures will help in reducing your home insurance premiums, and above all, help in keeping you home safe 24/7.

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