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Average Cost of Home Insurance 2019

Cheap Home Insurance in Your Area

Quickly compare over 3 dozen UK insurance providers. Only one form to fill out.

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Whether you're a new homeowner buying home insurance for the first time or it's time to renew your existing home insurance policy, what should you expect to pay for combined buildings and contents insurance? We've gathered quotes from a dozen of the best UK home insurance companies in order to get an idea of how much you'll pay for home insurance.

Below, we detail average costs and the range of likely prices you might find as you begin to shop, both for basic and more premium policies. Use this information to help you gauge what type of policy fits in your budget and whether a quote is too good to be true, or perhaps more than you need. For information on costs of extras like family legal cover, accidental damage, personal belongings, bikes and home emergency cover, see our article on average costs of home insurance extras.

Average Cost of Home Insurance

After quoting around 50 different building & contents policies across 10 popular insurers, we found the average cost of home insurance to be £265 per year for a 3-bed, 2-bath terraced house in London, reflecting a sample of excess levels (£100, £200, £500 and £1,000, where available) and types of policies (from basic to premium). The range of annual premiums was quite large, from as little as £131 per year up to £485 per year.

Buildings Cover AmountAverage Cost of Combined Home Insurance per Year
£500,000£200
£1,000,000£246
Unlimited£306
chart showing average home insurance premium by buildings cover amount
Buildings & contents insurance premiums rise with buildings cover limit

Policies towards to top of the range typically offered higher coverage levels—for instance, higher valuables cover and unlimited buildings cover as well as the inclusion of accidental damage, away-from-home cover, home emergency cover and legal cover (most of which would cost extra on a basic policy). You can also read our research on the average cost of home insurance extra, add-on features.

How Excess Affects Home Insurance Premiums

Like all insurance policies, the home insurance premium you pay can often be reduced by electing to pay a higher excess, and vice versa. The excess is the amount you pay towards any claim before the insurer pays any reimbursement. The more you are willing to pay towards a claim (the excess), the less your insurance policy will cost you. While you may be enticed by a lower premium, carefully consider the financial impact a higher excess should you ever need to claim on your policy.

Premiums Drop When You Pay a Higher Excess

ExcessAverage Buildings & Contents Insurance Premium (Annual)
£100£300
£200£262
£500£226
£1,000£148

What is a Compulsory Excess?

Some insurers will impose a minimum excess on your policy, which is an amount you must pay towards any claim. A compulsory excess is non negotiable. Not all insurers apply a compulsory excess; some have £0 compulsory excess, letting you choose the entire excess amount through your selection of voluntary excess. Whether or not you have a compulsory excess, you'll be able to add a voluntary excess amount.

What is a Voluntary Excess?

As its name implies, the voluntary excess is an amount chosen by you. Selecting a higher excess should lower the premium you pay, but keep in mind that your coverage is reduced if you need to claim. You'll be required to pay any excess before the insurer kicks in to pay.

chart showing average home insurance premium by excess
How Excess Affects Home Insurance Premiums

How Much Does House Insurance Cost a Month?

According to our research, the average monthly payment for buildings & contents insurance falls around £24.92 per month—for those electing to pay monthly instead of annually.

By paying monthly instead of upfront annually, you are essentially borrowing money from the insurer. Insurance companies charge for this loan, at an average rate around 22.9% APR—that's quite a bit more than the average credit card APR for those with good credit of 17.9%. If you have the cash, we recommend paying upfront to say yourself the interest payments.

How Much Will Paying Monthly for Home Insurance Cost You?

By paying monthly, you will incur costs of both the premium and an interest payment each month. On a £265 annual policy with a 22.9% APR, your £24.92 monthly payments include around £2.80 in interest charges. Over the course of a year, you'll pay around £34 in interest payments for your home insurance—an expense you can avoid by paying annually instead of monthly. For more information on this topic, please read our article Should I Pay my Home Insurance Annually or Monthly?

Cheap Home Insurance in Your Area

Quickly compare over 3 dozen UK insurance providers. Only one form to fill out.

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