Prices just keep rising, but it's not all bad news. You can get insurance for the same price today as you did in 1994!
Our bills are going up all over the shop: council tax, utilities, petrol.I can't go on; it's just not funny. This morning I thought that surely there must be some good news amongst all this? And there is! It seems we get some light relief from insurance.
Car insurance
Good news! According to the AA, comprehensive car insurance premiums have declined by 3.6% since 2004. Unfortunately, non-comprehensive cover (i.e. third party only and third party, fire and theft) has risen by almost 10%.
From my experience of the insurance industry, third party only policies are getting expensive because lots of insurers no longer like to offer it; they believe it doesn't offer enough cover. The cost of third party, fire and theft is rising because a greater number of reckless drivers are buying cheap cars with these policies, and then crashing them into Ferraris. Oops!
The funny thing is that, as a result, comprehensive cover can actually be cheaper for you than third party, fire and theft, which in turn can sometimes be cheaper than third party only. Weird!
The strange anomaly that causes some comprehensive policies to be cheaper than third party, fire and theft applies mostly to young drivers who have cheap vehicles. If you fit that profile, make sure you always get a quote for comprehensive cover, as well as third party, fire and theft.
Home insurance
The AA reports that the cost of home insurance is pretty much the same now as it was twelve years ago. The price of buildings insurance today is £207, up from £206 in 1994. Contents insurance was £144 in 1994 and is now £152. Furthermore, in the past three months buildings insurance prices fell 0.49% and contents went up by an insignificant 0.15%.
Premiums have been kept down by competition, a better pinpointing of flood and crime risks and, in my experience, by a more streamlined claims-handling process.
What we should learn from this is that if your renewal premium is higher than last year's, it's time to shop around. Better yet, shop around anyway, as you always should! The AA showed that shopping around could save you £68 for buildings insurance and £72 for contents!
The AA also showed that shopping around could save you almost £300 for comprehensive policies and more than £400 for third party, fire and theft. So compare insurance quotes and switch!