It follows separate figures from the Association of British Insurers (ABI) in May - which is based on prices paid rather than quotes - that showed an annual rise of 19% in the first quarter of this year.
Here, Which? takes a closer look at the price of home insurance, why costs are rising and explains how to pay less.
What's happening to home insurance prices?
The latest figures from Consumer Insight found the average quoted price of home insurance rose by 41.6% in the 12 months to April - the biggest price jump since the insurance price experts started tracking costs in 2014.
Customers with buildings claims experienced the biggest annual rise of 50.3%, followed by a 49.8% price hike for those with water damage claims. Theft-related claims also resulted in a 43.7% surge in the cost of premiums, with other damage claims leading to a 46.4% climb. In contrast, customers with no claims saw a 40.9% adjustment.
The trend also shows no signs of slowing, with the index showing quoted premiums for buildings and contents insurance jumped by 10.3% in the last three months as well – the highest quarterly increase in a decade. Almost a quarter (24%) of premiums are worth between £150 and £199, with those who have recently reported thefts seeing prises rise by 13.8% in the past three months.
The ABI's latest report, published in May, also shows a 19% annual surge in the average combined home insurance premium - from £315 in the first three months of 2023 to £375 between January and March 2024. That's also £11 more than the last three months of 2023 - a quarterly rise of 3%.
The ABI releases the most comprehensive data on home insurance pricing on a quarterly basis, as it's based on the price paid by customers. It also reflects the premiums paid by all customers (both renewing and those shopping around).
The chart shows how the average cost of a home insurance premium has risen since January 2022:
Comparison sites publish data as well, but their figures only reflect quotes given to customers searching for home insurance.
The latest report from Compare the Market found the average quote for combined home insurance hit £209 from January to March 2024. That's an increase of 31% compared to the first quarter of last year when prices stood at £159.
Find out more:Why is the cost of home insurance so high?
Matthew McMaster, senior insight analyst at Consumer Intelligence, blamed inflationary pressures for the price hikes, with the cost of raw building materials and labour soaring.
The ABI also points to last year's extreme weather for a rise in home insurance prices. The quick succession of storms Babet, Ciaran and Debi between October and November 2023 caused £352m of damage to homes and led to a surge in weather-related claims, worth a total of £573m. It was the most on record and damage caused by flooding made up the lion's share of claims.
Insurers have passed on those costs to customers through premium price hikes.
Separate data from Compare the Market data for the first quarter of 2024 found home insurance for properties that have previously flooded were on average £245, or 117%, more expensive to insure than homes that have not previously flooded. Typical insurance premiums for the former rose to £454 in January to March this year.
The rising cost of materials and labour needed for repairing and rebuilding damaged homes has also pushed up the cost of settling claims. Figures from the ABI revealed the value of claims being paid out by insurers jumped by nearly 10% to £2.55bn in 2023.
Find out more:Ways to save on home insurance
The cost of home insurance may be rising, but there are several ways to mitigate any premium price hike:
1. Shop around
This should always be your starting point. But with so much choice, deciding which insurer is right for you can be hard.
Price comparison sites that allow you to view multiple quotes at a glance are a good place to start. The main ones for insurance are Compare the Market, Confused.com, GoCompare and MoneySuperMarket.
2. Don't automatically renew
Never agree to the auto-renewal clause included in your 12-month home insurance agreement. This means that once your initial one-year contract lapses, you will be automatically enrolled for another year.
Instead, use the best quotes you've gathered to negotiate with your insurer and take your new business elsewhere if it doesn't improve its offer.
3. Renew early
If you leave arranging home insurance until the last minute, generally speaking, insurers are likely to charge you more than if you bought the cover a few weeks in advance of the cover starting.
Try buying your insurance weeks (rather than days) ahead of the policy going live.
4. Pay annually
Paying by the month for your cover can make it more manageable within your budget, but it can be the most expensive option overall.
You're effectively borrowing the year's premium to repay in instalments. This typically comes with interest, hiking your annual cost.
5. Cheaper isn't always better
Opting for the very cheapest policy you can find won't necessarily save you money in the long run.
If your policy comes with steep excesses or significant exclusions, you'll feel the pinch when it's time to claim. This means it's vital you check the policy details carefully before buying the cover.
Find out more: This story is regularly updated with the latest figures from the ABI and Consumer IntelliegenceWhich? Limited is registered in England and Wales to 2 Marylebone Road, London NW1 4DF, company number 00677665 and is an Introducer Appointed Representative of the following: 1. Inspop.com Ltd for the introduction of non-investment motor, home, travel, pet, van and temporary insurance products (FRN 610689). Inspop.com Ltd is authorised and regulated by the Financial Conduct Authority (FCA) to provide advice and arrange non-investment motor, home, travel and pet insurance products (FRN310635) and is registered in England and Wales to Greyfriars House, Greyfriars Road, Cardiff, South Wales, CF10 3AL, company number 03857130. Confused.com is a trading name of Inspop.com Ltd. 2. LifeSearch Partners Limited (FRN 656479), for the introduction of Pure Protection Contracts, who are authorised and regulated by the FCA to provide advice and arrange Pure Protection Contracts. LifeSearch Partners Ltd is registered in England and Wales to 3000a Parkway, Whiteley, Hampshire, PO15 7FX, company number 03412386. 3.Which? are an Introducer Appointer Representative of Optimise Media Limited (FRN 313408), for the introduction of HSBC Group, who are authorised and regulated by the Financial Conduct Authority to provide credit brokering activity. Optimise Media is registered in England and Wales to Exchange Street Buildings, 35-37 Exchange Street, Norwich, England, NR2 1DP and company number 04455319. We do not make, nor do we seek to make, any recommendations on financial products or services that are regulated by the FCA, as we’re not regulated or authorised by the FCA to advise you in this way. In some cases, however, we have included links to regulated brands or providers with whom we have a commercial relationship and, if you choose to, you can buy a product from our commercial partners. If you go ahead and buy a product using our link, we will receive a commission to help fund our not-for-profit mission and our campaigns work as a champion for the UK consumer.
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