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What's happening to home insurance premiums?
Premiums fall, but bad weather continues to drive claims to record highs
Matthew is an award-winning journalist, specialising in savings, tax and insurance.
The average home insurance premium fell for the fourth quarter in a row at the beginning of the year, figures from the Association of British Insurers (ABI) show.
The annual cost of combined buildings and contents cover in January to March 2026 was 5% less than the same period last year. That's despite insurers paying out £846m in property claims.
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 dipped to £375 in January to March 2026, down from £380 in the previous three months (October to December 2025).
Average home insurance premiums have fallen steadily since peaking at £399 in the third quarter of 2024 and are now 5% lower than the first three months of 2025 when it stood at £396. However, they are still £6 higher than the same period two years ago.
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 that insurers paid out £846m in claims in the first three months of 2026.
The average household claim hit £6,340. That's the highest on record and 20% more than the same period last year.
Extreme weather continues to be the main driver behind the increase in claims payouts. January to March 2026 saw insurers pay an average of £6,040 in weather‑related damage claims. That's 38% more than in the same period last year when it hit £4,390 and is the highest first quarter average on record.
The average household subsidence claim was also up year-on-year, rising 9% from £16,295 in 2025 to £17,820 in the first quarter of 2026.
- Find out more: does home insurance cover flooding?
Comparison sites also publish data, but their figures only reflect quotes given to customers searching for home insurance.
The latest figures from GoCompare echo the ABI's report and found the median average home insurance cost was £225 in the final three months of 2025. That's the same as the previous quarter but 2.6% less than one year before, when premiums stood at £231.
Separate data from Compare the Market also showed a drop in prices over the last 12 months. The report showed average home insurance premiums fell by 9% year-on-year in January this year, falling from £218 in 2025 to £198 in 2026.
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.
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.
But remember, not all providers are on there. Which? Recommended Provider NFU Mutual is an examples of this.
2. Don't automatically renew
Never agree to the auto-renewal clause included in your 12-month home insurance agreement. This 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.
