What's happening to home insurance premiums?

The average home insurance premium rose for the first time since the beginning of last year, figures from the Association of British Insurers (ABI) show.

Despite the small increase, the annual cost of combined buildings and contents cover in April to June 2026 is 2% less than the same period last year. That's despite the average payout for a claim hitting an all-time high of £7,000.

Here, Which? takes a closer look at the price of home insurance, why claims costs are rising and how to pay less for your premium. 

What's happening to home insurance prices?

The ABI's latest report shows that the average price for a combined policy rose to £383 in April to June 2026, up from £375 in the previous three months (January to March 2026). 

It's the first time average home insurance premiums have increased since the beginning of 2025 and, despite the small uptick, are still £9 less than this time last year. 

Released every three months, the ABI's data gives the most accurate picture of the market as it's based on prices consumers are actually paying, rather than quotes, and combines both renewals and new policies.

This chart shows how the average cost of a home insurance premium has changed since January 2022.

• Find out more: how to find cheap home insurance

Why is the cost of home insurance so high?

The high cost of settling claims is a key reason why insurers are unable to make bigger cuts to premium prices. The latest ABI figures show the average claim went above £7,000 for the first time in April to June 2026.  

Extreme weather continues to be one of the main drivers behind the increase. The average claim for damage to people’s homes and possessions from flooding, storms and burst pipes reached £8,548 in the second quarter of 2026, up 12% on the same period in 2025. 

The average household subsidence claim was also up, reaching a record £20,000. In total, insurers paid out £72m during the second quarter of 2026. 

The figures follow the warmest spring on record in England and Wales, and the third warmest across the UK, with prolonged dry weather increasing the risk of ground movement and damage to properties.

• Find out more: does home insurance cover flooding?

Ways to save on home insurance

The cost of home insurance may be rising, but there are several ways to mitigate any premium price hike:

1. Shop around

This should always be the first thing you do. But with so many options, choosing an insurer can be hard. 

Price comparison sites that allow you to view multiple quotes at a glance are a good place to start. The main ones for insurance are Compare the Market, Confused.com, GoCompare and MoneySuperMarket.

But remember, not all providers are on there. Which? Recommended Provider NFU Mutual is an example of this. 

To get a clearer idea of how different home insurance policies compare, you could also see our guides to the best contents insurance and buildings insurance. We've rated policies from dozens of insurers to help you choose the right cover.

2. Don't automatically renew

Never agree to the auto-renewal clause included in your 12-month home insurance agreement. This clause means that once your initial one-year contract lapses, you will be automatically enrolled for another year.

Instead, use the best quotes you've gathered to negotiate with your insurer and take your business elsewhere if it doesn't improve its offer.

3. Renew early

If you leave arranging home insurance until the last minute, generally speaking, insurers are likely to charge you more than if you bought the cover a few weeks in advance of it starting.

Try buying your insurance weeks (rather than days) ahead of the policy going live. 

4. Pay annually

Paying by the month for cover can make it more manageable for your budget, but it's usually the most expensive option.

When paying monthly, you're effectively borrowing the year's premium to repay in instalments. This typically comes with interest, hiking the overall cost.

5. Cheaper isn't always better

Opting for the very cheapest policy you find won't necessarily save you money in the long run.

If your policy comes with steep excesses or significant exclusions, you'll feel the pinch when it's time to claim. This means it's vital that you check the policy details carefully before buying the cover. 

• Find out more: how to find cheap home insurance

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This article is regularly updated with the latest figures from the ABI and other home insurance indices. The ABI occasionally adjusts previously published figures when updated data becomes available.