Author: Alex Gregory
Source: ezinearticles.com
There aren’t too many positive financial stories to emerge from the credit crunch but there may be at least one good piece of news for consumers as home insurance premiums look set to fall.
According to the AA, the average buildings insurance premium has increased from £109 to £123 over the last year even though house prices fell by an average of 15 per cent. This is because buildings insurance relates to the rebuild value of a home and not its retail value.
However, these costs have started to fall in recent months due to the crisis in the construction industry. Many building firms have slashed their costs in an attempt to attract business and according to the Royal Institute of Chartered Surveyors expenses should fall by around seven per cent this year as companies continue to struggle for work.
Consequently, lower insurance costs could be one of the silver linings of the credit crunch although industry experts do warn that property owners shouldn’t get their hopes too high. The benefit may take some time to filter through to consumers particularly as insurers tend to base their premiums on the number of claims they have had to pay out during the previous year.
So if we are going to have to wait for cheaper home insurance all around, what can we do to find less expensive deals in the meantime?
Homeowners are encouraged to make an accurate assessment of the rebuild cost of their home and also the contents inside – while it is important to avoid under-insurance you should also avoid paying for cover you don’t need.
For cheap home insurance make sure you compare home insurance online at least once a year. Most providers offer their lowest rates to new customers and particularly those that buy online where they can take advantage of reduced overhead costs