Cheap home insurance hotspots revealed ‘Postcode lottery’ means prices differ

13 May 2010

home insurance

The price of home insurance varies by up to 176% depending on your postcode, new research has found.

The study by price comparison website Moneysupermarket involved analysis of over 2m home insurance quotes over 12 months, and revealed the UK’s hotspots for the cheapest, and most expensive, home insurance premiums.

The average cheapest home insurance premium for a property in the UK is £164 a year, according to the site.

Cheap home insurance

Homeowners in Bournemouth, York and Glasgow pay the lowest home insurance premiums, Moneysupermarket says. The cheapest available premiums in Bournemouth cost £103.98, with the cost of cover in York and Glasgow just slightly higher at £109.22 and £110.73.

Other locations that have been identified as cheap home insurance hotspots include Tidworth in Wiltshire, Nottingham, Leicester, Enniskillen in Northern Ireland, Aberdeen and Cardiff.

Pricier insurance premiums

On the other hand, the UK’s 10 most expensive places to buy home insurance are all in Greater London according to Moneysupermarket’s research.

Homeowners based in Stanmore can expect to pay a minimum of £286.50 a year for home insurance, while residents of Golders Green and Dulwich face premiums of £280.59 and £279.07 respectively.

Home insurance policies in these areas cost 74% more than the UK average and – in the case of Stanmore residents – 176% more than in Bournemouth.

Other London locations identified as problematic for those in search of cheap premiums include Mill Hill, Northwood, Harrow, Edgware, Brent, Barnes and Winchmore Hill.

Competitive home insurance quotes

Julie Owens, head of home insurance at Moneysupermarket, said: ‘If your property is classified as being in a ‘high risk’ area – whether for crime, flooding or even subsidence – it will be reflected in your insurance premiums. Living in a more affluent area will also increase premiums as property and contents values will generally be higher.’

Which? insurance expert Dan Moore commented: ‘Postcodes are a pretty blunt instrument, and insurance premiums should be based on more than this.

‘Putting too much emphasis on postcodes may mean insurance companies penalise people who take steps to ensure their properties are secure and have never made a claim.

‘If you’re looking to reduce the price of your home insurance premium, it makes sense to put locks on your windows, install British Standard five-lever mortice locks on your doors and – if you can – fit a burglar alarm that you use at all times.

'Finally, don’t forget it’s also crucial to shop around for the best deal. While  price comparison sites can be helpful, the Which? investigation into how they work shows you should use them with caution. The Which? review of home insurers features recommended providers of home insurance, who provide high quality policies as well as receive strong customer services feedback from our members.’

pound coins

Which? Money when you need it

You can follow @WhichMoney on Twitter to keep up-to-date with our Best Rates and Recommended Provider product and service reviews.

Sign up for the latest money news, best rates and recommended providers in your newsletter every Friday.

Or for money-saving tips, and news of how what's going on in the world of finance affects you, join Melanie Dowding and James Daley for the Which? Money weekly money podcast

For daily consumer news, subscribe to the Which? news RSS feed here. And to find out how we work for you on money issues, visit our personal finance campaigns pages.