Eastlife January 2019

Consumer
Martin Lewis Talks...
Stop letting home insurers (price) walk all
over you
Price walking is a clever technique many home
insurance providers use to make loyal customers
pay more. Each year if you stick with them they ‘walk’
up the price of cover – never too quickly to cause
alarm, but step, step, step, until they reach their goal.
After five years or so you can easily be paying more
than 50% over the odds.
So ask yourself, when did you last change your home
insurance provider? If the answer is more than a year ago,
you’re most likely paying a ‘loyalty penalty’ – far more
than you’d pay the same company as a new customer.
Yet you can easily stop this, and put more money in your
pocket without sacrificing quality of cover. The key five
steps to getting the right deal on your home insurance
are…
Step 1: Turn your house upside down to
define the right cover
There are two elements to home
insurance - buildings and
contents. An easy way to
work out what’s covered is to
imagine turning your home
upside down: everything
that stays put comes under
buildings. If it falls out, it’s
contents. A joint policy is
often easier as it means
no jurisdictional disputes
between firms.
Buildings insurance is only usually
needed by freeholders, not renters
or leaseholders. You only need to
insure the rebuild cost – so how much it
would cost to rebuild your home should it get
knocked down – rather than the market value, which is
the amount it might sell for. To find your rebuild value,
there’s a free calculator at abi.bcis.co.uk.
Contents cover is for everyone. Make sure that you
don’t under insure - to cut costs - thinking you’ll never
claim the full amount. If you do, it could mean you’re
then paid less if and when you do make a claim. And
you often have much more value in your home than you
think. Many insurers have useful calculators online to help
calculate the amount.
You should also go through all the details of things that
can make your house safer. Remember insurance pricing
is based on a risk assessment. There’s a huge variety
of things can impact on the premium you pay. There’s
full help on this and other steps in my detailed guide at
www.moneysavingexpert.com/homeinsurance
Step 2: Don’t just use one comparison site – combine
them
Comparison sites are a quick and easy way to find cheap
quotes if you’ve relatively straightforward circumstances.
Yet in truth they’re not actually comparison sites, they
are marketplaces, as they can have special deals and
prices with different insurers (but should never be more
expensive than going direct). So the best thing to do is
to combine a few of them to get a spread of insurers and
prices. You can simply open a few windows at a time and
put the same information in different ones.
Step 3: Check insurers that comparison sites miss
Two of the big insurers, www.aviva.co.uk and
www.directline.com are not included on comparison
sites, so check them separately, especially when they
have discounts (Aviva is currently offering a
discount of 20% for policies bought online).
Also there can be a range of special
promo deals that aren’t included on
comparison sites. When they’re
live they’re listed on www.
moneysavingexpert.com/
homeinsurance, so keep an
eye out.
Step 4: If you want to stay
put, haggle
Once you’ve found a cheaper
policy – you can always try
taking the price to your existing
provider and ask them to see if
they will match it – they often will.
Step 5: If you’re switching, once you
know what you’re getting, check for
cashback
Once you know your cheapest policy and crucially you’ve
checked IT’S RIGHT FOR YOU, then check if you can earn
cashback using a cashback site such as
Topcashback.co.uk or www.Quidco.com. These sites
pay you if you click through them to other companies
and purchase something - such as home insurance. This
usually works, but there can be tracking issues, so see
this as the icing on the cake rather than a core way to
choose. If you’ve got time and your top three policies
are all much of a muchness, it can be worth seeing the
cashback on offer for all three.
Martin Lewis is the Founder and Chair of
MoneySavingExpert.com. To join the 13million people
who get his free Money Tips weekly email, go to
www.moneysavingexpert.com/latesttip.
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