Home insurance premiums rise as motor prices dip

Home insurance premiums rose over the last month while motor prices dipped by more than 2%.

That was according to Pearson Ham’s price index, which revealed how the home and motor insurance markets performed in May in terms of prices for consumers.

Figures show that premiums for home owners increased by 0.4% during the month, with the average price now surpassing £420.

However, the year-on-year price decreased from a peak of 42% in February to 37% in May.

In terms of regions, Northern Ireland saw a 1.5% increase in May, leading to the UK’s highest year-on-year price hike of 55%.

London, meanwhile, saw a 44% yearly rise.

Stephen Kennedy, director at Pearson Ham, said: “The continued increases to home insurance premiums in May will add further spending pressure for consumers, but this has been primarily driven by the extreme weather events we witnessed last winter combined with ongoing claims inflation.

“We anticipated at the beginning of the year that achieving consistency in home insurance pricing would be challenging for insurers. As we approach the half-year mark, it has proven considerably more difficult than expected.”

Motor

As for motor, Pearson Ham found that the top five priced premiums saw a -2.5% decrease in May.

And the 12-month price movement for motor prices also reduced from its peak of 47% in Q4 2023 to 19%.

Frances Luery, product manager at Pearson Ham, said: “The period of inflation that drove up motor insurance prices was incredibly challenging for many people.

”We hope that insurers will continue to outline their expectations for future claims costs and how they are working to support policyholders.”