The typical cost of a home insurance policy that includes protection for high-value items – usually worth more than £1,500 – has increased by £58 from £243 at the end of 2022 to £302 in November 2023, according to data from Compare the Market.
The comparison site also found that including expensive goods such as jewellery, antiques and fine art will now add £108 to the cost of the premium.
Here, Which? explores the reasons behind the increase in covering high-value items and what customers can do to reduce the costs of home insurance.
Why are costs rising?
Soaring inflation over the past year – peaking at 11.1% in October 2023 – has pushed up the value of expensive items, as well as the cost of repairing or replacing them.
Compare the Market found that the typical value of expensive belongings itemised on home insurance policies has increased from £3,877 at the end of 2022 to £3,919 in November 2023. The most popular high-value items in our homes are jewellery and watches, with laptops, computer equipment and musical instruments also commonly listed.
The ABI’s property insurance premium tracker – a survey that looks at the prices customers paid for cover, rather than what they were quoted – also showed a 15% year-on-year increase in the average price paid for a combined buildings and contents policy. Over the same period, the average cost of a contents-only policy rose by 10% annually.
Don't let rising prices put you off
Home insurance price hikes could put you off taking out additional cover for expensive items, but the potential cost of doing nothing could be far greater.
Most contents policies will have a maximum paid out for any one item. It’s often around £1,500, but could be lower or higher depending on the insurer. High inflation, however, means that some possessions may now be worth more than the single-item limit, so the policy will only partially cover the cost of a replacement.
Make sure you don't underestimate the value of any expensive single items when you're buying home insurance.
Helen Phipps, home insurance expert at Compare the Market, also advises policyholders to check the limits of their cover. She says: 'Items taken out of the home and either lost or damaged could fall under personal possessions cover and may not be covered by the main home insurance policy.'
Find out more:Ways to cut the cost of home insurance
The price of home insurance may be rising, but there are steps you can take to reduce the cost of cover.
Paying annually is another way to save. Monthly payments may be easier to manage and budget for, but it's usually more expensive in the long run. That's because it typically comes with interest. Renewing early – weeks rather than days before your policy ends – can also shave money off the premium.
But remember, cheaper isn't always better. If your policy comes with steep excesses or significant exclusions, you'll feel the pinch when the time comes to claim. So check the policy details carefully before you buy cover.
Find out more:How to protect expensive items
Home insurance provides a safety net in the event that your most precious belongings are lost, damaged or stolen. But the best way to protect them is to prevent anything happening to them in the first place. If the insurer feels you've been careless and haven't properly secured them, you could find your claim is refused.
The ABI advises home insurance customers to consider upping security, from installing a burglar alarm or camera to simple measures such as checking all the locks on doors and windows are in good condition.
You should also be careful not to have expensive items on display for opportunistic thieves. Don't leave them near windows and consider storing them in a safe. And if you're going on holiday and leaving your home unoccupied, don't advertise the fact on social media.
What to do if you need to claim
If you've been burgled and items have been stolen, report the incident to the police straightaway. You will usually need to give your insurer a police report as proof that a theft has taken place.
Get in touch with your home insurance provider as soon as possible to make a claim. Many insurers operate 24-hour helplines and will be able to advise you on the next steps and what will happen with your claim as it goes forward.
To speed up the process, document all damaged or stolen items, as well as any emergency repairs you have to make – for example, to locks or windows. Your insurance policy will usually cover you for this, just make sure you save the receipts.
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source https://www.which.co.uk/news/article/adding-high-value-items-to-home-insurance-costs-25-more-this-year-aidCV3m5qVAP