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  • Home insurance premium change

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  • Home insurance premium split

    Home insurance price changes explained

    Did you know that every insurer now has to highlight what its customers had paid the previous year, when they come to renew? This way, everyone can compare prices, clearly and quickly. And because we’re restless in our pursuit to be clear with you, we wanted to explain why your home insurance renewal price could be different to last year – even if you’ve not changed anything. It looks like this:

    The cost of claims

    We’d like the homes we insure to be as safe as houses – and here’s why. It’s not just your own claims history that affects your home insurance premium. We pay millions of pounds every year to settle our customers’ claims – and that cost makes up the biggest chunk of what each person pays us to insure their home - find out more about where your premium goes. While insurance companies are here to absorb higher repair and replacement costs associated with a claim, there are instances where this does have an impact on customers’ premiums – for example as home technology gets more expensive to replace. So let’s all hope our homes stay safe and sound – that way, we can all benefit.

    Bad weather

    We’re not alone in complaining about the weather. It’s not just rainy days that get us down – storms and cold snaps can put prices up. Weather patterns are changing, and we’re seeing more flooding and storm damage unfortunately. So to make sure we’re able to put right all weather-related claims in future, increasing risks may lead to increases in premiums.

    Insurance fraud

    According to a 2016 report by the Chartered Institute of Insurers, insurance fraud costs policyholders up to £50 per year. Unfortunately, it’s the innocent who end up paying the price. So we’re working hard to stamp out fraud and stop this crime from hurting us all.

    Taxes

    Nobody likes paying taxes – that’s something we can agree on! Unfortunately, though, taxes to regulatory bodies and the government make up part of your price. Take Insurance Premium Tax (IPT) for example. Between November 2015 and June 2017 it went up four times – from 6% to 9.5%, 10% and then to 12%. That’s quite an increase that every insurer needs to include on every policy. If IPT continues to go up in future, this may unfortunately impact your future premiums when it’s time to renew.

    New technology

    Today’s homes are becoming more and more advanced every year. Items in and around the home are increasingly complex, and repairing or replacing them after a claim can be a lot more expensive. We take into account the trends when we’re pricing policies.

    Your No Claims Discount (NCD)

    If you’ve not made a claim on your home insurance for a year, your insurer will reward you with a discount. It’s a little thank you for looking after your home.

    Even if the price has gone up for any other reason, you can rest assured that your No Claims Discount saves you money – your home insurance renewal would be a lot higher without it.

    Why a change to your details could change your premium

    It’s important to make sure your home insurance is always correct and right for you. It means you have the cover you need to take care of your home – and we have accurate information to put things right with less fuss if you ever make a claim. By informing us of any changes, big or small, will ensure that you’re paying the right premium.

    When any of your details change, you must let us know. It’s quick and easy to do this with AXA – you can simply log in to your AXA Account and update your information yourself. And the best thing is, there are no extra administration fees when you make changes yourself online.

    Some changes, however, can affect the price of your insurance – either as soon as you make the change, or when it’s time to renew. Here are some of the reasons why it could go up or down:

    Your new home

    It may be stating the obvious, but if you are moving house, you need to update your home insurance. If you were upsizing, you’d probably expect to pay more for your insurance too. And you’d be right – as larger homes with more rooms tend to have more possessions, and higher costs for repairs. Generally, the bigger the home, the more it will be to insure.

    Older homes often have higher insurance costs too, as things are more likely to go wrong.. And statistics show that detached homes are more at risk of burglary. Rest assured, when you move home, we’ll work out the right price to take care of it based on all the data we hold.

    Your new address

    Location, location, location. Where you live is very important. Even moving to a similar house a few streets away could see your insurance price change. Because we don’t just base our quote on your home and the people living in it – we take into account your neighbourhood too.

    Here are some key factors that could see your premium go up or down when you move home:

    • Closeness to water sources, and how many homes have been affected by flooding
    • The number of claims made in the area
    • Crime and vandalism

    As a general rule of thumb, if our data for these three things shows high numbers for a particular postcode, then premiums in the surrounding area are likely to be higher too. So it’s doubly good news if you’re moving to an area where we’ve seen fewer claims – it could be a safer place to live, and your home insurance could cost less too.

    Your family and the people who live with you

    More people indoors mean more chances of damage being caused. So it’s likely you’ll pay more for your home insurance if people move in with you. And while having a baby is a wonderful, life changing event – it could also change the price of your home insurance. That’s because statistics show young families make more claims. Nevertheless, when your policy is due for renewal, it’s important you tell us about everyone who lives at home, and let us know when children grow up or fly the nest, to make sure you always have the cover that’s right for you.

    Your home improvements

    If you’re making your home larger by adding a bedroom, it’s important to let us know. You can update the number of bedrooms online using your AXA Account (it’s much quicker than the actual building work.), and you won’t pay a penny in admin fees. We’ll then calculate any changes to your premium to make sure you have extra cover for your extra bedroom.

    Plus, if you’re planning on adding an extension or converting the loft, make sure you give the help team a call before any building work starts. Most builders have their own insurance to cover damage while working on a home, but it’s well worth checking with them first – better safe than sorry.

    Claims

    Making a claim won’t affect the price of your insurance straightaway, but you may see an increase when it’s time to renew. As you would expect, people with fewer or no claims tend to pay less for their home insurance.

    Our phone lines are open 24 hours a day for you to make a claim – we’re here to help.