Home insurance prices surge at record pace

The average quoted price of home insurance jumped by more than a third (36.1%) in the 12 months to October 2023, according to new data from Consumer Intelligence’s Index.

The financial services insights provider highlighted this was the highest annual increase on record, beating the previous all-time high increase of 25.7% set just three months earlier.

It revealed that in the year to October, the average of the five cheapest quotes for a buildings and contents policy stood at £227, compared with £163 during the same period in 2022.

This came as customers claiming for water-related damage saw quoted price rises of 42.8%, while those with buildings claims have seen increases of 40.7% and those with damage related claims 39.5%. 

Storms

However, despite premiums rising at record pace during the year to October, the three months prior saw a slowdown in quoted price increases.

Consumer Intelligence said that there was a rise of 8.5% compared with the record 9.9% in the previous three months – but it said insurers were now likely to look to recover the cost of claims from the recent weather events, such as Storms Babet and Ciara.

“With Storms Babet and Ciaran causing significant damage to thousands of homes across Britain, we anticipate further increases in premiums over the coming months,” Laura Vas, senior insight analyst at Consumer Intelligence, said.

“Homeowners with prior claims may see additional increases in coming months following recent storm damage, although insurers could spread the claim costs across all policy holders driving further market inflation.”