According to new data released by insurance expert, Consumer Intelligence, last year’s record breaking summer of prolonged dry weather and high temperatures is driving an increase in subsidence claims across the industry.
The data released suggests that as a result of a rise in claims home insurance price cuts could be about to end sending bills higher.
Average premiums dropped 1% to £137 in the year to January as providers kept prices low to compete for business, but the last six months have seen increases of 1.7% pointing to the likelihood of higher premiums in the future.
Customers in Wales and the South West are paying the lowest annual bills at £121 and £123. Wales has experienced the biggest price falls with premiums down 4.3% on a year ago, while in the North East they fell 3.0%. Londoners pay the highest annual bills at £181 with prices up 1% in a year while customers in the East Midlands and South West saw price rises of 0.8% and 0.5%.
Premiums for newer homes are the lowest with average prices for houses built since 2000 at £128. Customers with houses built before 1895 can expect to pay 30% more at £167.
John Blevins, Consumer Intelligence pricing expert said: “Competition in the home insurance market is keeping premium increases to a minimum with only a few areas of the country seeing limited price rises.
But the past six months has seen premiums starting to rise and that may be an indication of things to come with all parts of the country likely to be affected. Claims costs remain the main driver of premiums that we see, and the industry as a whole is experiencing a rise in subsidence claims which are costly for insurers and that will have an impact on total claim costs and prices.
Customers are still paying around 1.4% less for home insurance than in February 2014 when Consumer Intelligence – whose data is used by the Government’s Office for National Statistics to calculate official inflation statistics – first began collecting prices.”