New data from the Association of British Insurers’ (ABI) Home Insurance Premium Tracker shows the average price of home and contents premiums in the UK rose at a rate less than ongoing inflation within the last year.

Survey results show the average price for home insurance paid by homeowners was £315 ($590.21), a 6% rise compared to results from the same quarter last year and a 3% rise from the previous quarter.  

ABI also reports that the average building-only premium rose by 5% since this time last year, to £236 ($442.19), while contents-only policies were priced at £117 ($219.22), a minimal rise from the previous year.  

The figures follow changes set up by the Financial Conduct Authority at the start of last year, ensuring that existing motor and home insurance policyholders were not charged prices greater than a new customer who bought an equivalent policy through a distribution channel. The ABI notes that these rules did not set a cap on the levels of premiums paid by new or existing customers.  

“Insurers appreciate these continue to be tough times for many households coping with the rising cost of living,” ABI General Insurance Manager Laura Hughes said.  

“The rise in the average combined buildings and contents premium over the last year remains under the inflation rate, despite the above inflation rises in the cost of many building materials.”  

ABI remarks that the price rise comes at a time when home insurers paid £2.5 billion ($4.68) for claims last year, a 6% rise, with increased storm events and surging construction prices contributing to the high costs.  

“Last year’s storms and the surge in subsidence claims following the summer heatwave were a dramatic reminder of the importance of home insurance,” Ms Hughes said.  

“During these challenging times, anyone worried about being able to continue paying their home insurance should speak to their insurer about any alternative payment options that may be available.”