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Daily Insurance Industry News
Sunday 21st of January 2018
July 31, 2009

Buildings and contents premiums diverge

by Gill Montia

Story link: Buildings and contents premiums diverge

Buildings and contents premiums diverge

New research from AA Insurance shows a 10% rise in the average cost of residential buildings insurance, over the 12 months to the end of June.

The cost of annual buildings cover has now risen for the sixth successive quarter, to £223.92.

However, those making a keen effort to shop around can expect to pay less.

According to the AA, the hike is in response to increased claims from weather events linked to climate change, such as flash floods.

Notably, claims have risen 15% by number and value in the past year in areas of the UK where severe weather related events were previously unknown.

AA Insurance director, Simon Douglas, said: “Insurers are beginning to reflect concerns about climate change … the industry is expecting rising cost and frequency of claims for flooding, subsidence and storm damage.”

Meanwhile, contents insurance premiums have fallen over the past 12 months, partly as a result of insurers taking greater account of local crime rates.

The cost of cover is down 3.2% on the year to an average £122.34 but those living in high crime rate areas can expect to see premium rises.

Finally, the number of fraudulent claims detected has increased up by 30% this year, apparently reflecting improvements in the ability of insurers to identify and deal with potential fraud.

 

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