Wednesday 16 January 2019

'Your payments may be creeping up each year'

Get the right insurance for your house to make sure it’s protected
Get the right insurance for your house to make sure it’s protected

Hopefully we'll get a milder spring than last year - which won't be hard given the virtual standstill Ireland came to with the deluge of snow in 2018, but that doesn't mean you won't still be paying for it.

House insurers took a huge hit last year between flooding, freezing and other weather-related events. Of course, everyone pays, even if you didn't have a claim, such is the system of 'pooled' risk.

Insurers pay close attention to geography and address before they agree to insure a house, so it's worth seeing whether there is any way you can switch to save money when it comes to renewing your premium this year. The good news is you can!

Insurance companies are like posh book-makers. Their job is to take as much business as they can without overloading their books with similar risks.

That means Insurer A may already have its fair share of three-bed semis in Waterford, while Insurer B has its hands full with four-bed bungalows beside the Shannon.

Loyalty is misplaced, so you can find yourself priced high to get rid of you, without you realising why. Deirdre McCarthy of insuremyhouse.ie says switching is a powerful tool to keep premiums low.

"Many people stay with their current provider year on year, perhaps because the policy was initially set up through the bank they took their mortgage out with and they believe, mistakenly, that they must keep the insurance with the same bank.

"It's paid by direct debit and they may not notice the price is creeping up each year. My advice is to shop around or get a broker to do the legwork for you."

She adds: "People should read the assumptions of the policy as a number of factors could affect the premium or even lead to a decline of cover or part cover, e.g., does the house have a flat roof or a home office? Is a business being run from the house? Would there be lots of callers and cash kept at the house? The distance the house is from the nearest river/lake/flood area matters, so Eircodes have started to prove a very useful tool. The occupancy of the house is also an important fact - is it rented, unoccupied or is a family member living there, rent free - all of these facts can have a different impact on quotations."

Keeping your 'Buildings' cover to a realistic level will cut costs. Insure only for the 're-build' value, not what your house would sell for (see scsi.ie for regional re-build estimates) and take the time to actually value your content items.

How to switch... home insurance

STEP 1 Find the re-build value of your house, not its market value. Add 10pc for extras.

STEP 2 Calculate your contents accurately - don't rely on a percentage of buildings cover as you will only get back what the assessor deems items to be worth. Anything valued over €2,000 should be detailed, photographed and insured separately under the 'specified risks' section.

STEP 3 Contact at least three insurers, or engage a broker and ask exactly what the policy includes... and excludes.

STEP 4 Complete new application form carefully. Do it all again next year.

Potential savings: €250

Total time: 2 hours

Irish Independent

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