Rising construction expenses, higher property values, and increasingly extreme weather patterns have all contributed to an 8.5% increase in combined home insurance premiums across the UK.
Data from Q4 2024 reveals that the average annual cost for a buildings and contents insurance policy climbed to £231.
However, prices vary significantly by region:
Greater London (second most expensive area): £336
Scotland: £228 (close to national average)
North East: £190 (most affordable)
North West: £196
Claims surge
Rising rebuild costs, driven by material shortages, higher labour rates, and broader inflationary pressures, have placed added strain on insurers.
Compounding the issue, claims activity has spiked. In Q1 2025, UK insurers paid out a record £886m in domestic property claims – a 20% year-on-year increase, largely due to severe weather events.
Tips to reduce costs
Even with premiums on the up, there are still ways to keep your insurance bill manageable:
opt for a combined buildings and contents policy,
avoid unnecessary extras,
pay annually rather than monthly,
shop around for the best deal.
Your individual circumstances also play a role. For example, the number of bedrooms your home has and whether you have a burglar alarm will influence your premium.
Going away this summer?
If you’re going on holiday, remember not to leave a spare key in an obvious place (like under a plant pot or doormat). Most insurers will only honour theft claims if there’s clear evidence of forced entry – so small precautions can help protect your cover.
Sources: ABI, 2025
🚨 Data accurate as of the date of publication
🚨 The above material is for informational purposes only and does not constitute a sales offer or financial advice. Before taking out any insurance, credit agreement or other financial product, you should obtain individual advice on your requirements and the general terms of the contract.
Source: Quilter Financial Planning – Essentially Mortgages Q3 2025
