Personal Finance News

Here are some invaluable hints and tips to help you cut the cost of your home and contents insurance.

1. Improve your security to benefit from insurance discounts
Consider improving the security of your home. Many home insurance companies will offer a discount if:

• You are an active member of a registered Neighbourhood Watch scheme.

• A burglar alarm is installed. Note that many home insurance companies will only offer a discount if the alarm is installed by a contractor approved by the National Approval Council for Security Systems (NACOSS). In addition, some home insurance companies may require you to have a maintenance contract with a company registered with the National Approval Council for Security Systems.

• Smoke alarms are installed.

• All windows have key operated locks.

• All exit doors are fitted with a British standard approved lock.

2. Pay small claims yourself
If you claim on your household insurance, premiums are likely to increase the following year. So pay all minor claims you can afford yourself, this is likely to save you money in the long run. Many home insurers offer a no claim discount if you have a claim free history. The discount will usually increase in line with the number of claim free years.

3. Opt for a higher excess
If you can afford it consider paying a higher excess on your policy, so rather than paying the first £50 of any claim, consider paying the first £100 or £150. This can significantly reduce the monthly cost of your home insurance, although it does mean you will have to pay more when you do claim so don't opt for more than you can reasonably afford. It could be an effective way for you to save money.

4. Shop around
Half an hour on the Internet could save you hundreds of pounds. For example 10% of people who obtained a quote from Regal insurance saved over £313 when compared with their existing premium.

5. Buy your cover online
If you buy your home insurance online many insurers will offer you a discount of up to 20% or 30%. Check out the latest deal from ASDA home insurance and save up to £115.

6. Pay your premium in a single annual payment
If you can afford to pay your home insurance premium in a single payment you'll save money. Many insurers charge a hefty interest rate on a home insurance policy if you decide to pay monthly.

7. Don't be shy, haggle for a better deal
The home insurance market is very competitive and companies are desperate to keep you as a customer. So don't be afraid to pick up the phone and try to haggle with your existing insurer, after all if they can beat or even match the best quote you've been offered online it saves the hassle of switching insurers.

8. Don't automatically take the cover offered by your lender
More than half of people taking their first step onto the property ladder and arranging insurance - almost 200,000 people each year -still automatically buy their cover through their mortgage lender, even though organising it that way can cost up to 30% more due to the massive commissions that lenders take on insurance sales.

Some mortgage lenders make it difficult for people to break free from their policy, by forcing people to pay a penalty fee for switching their insurance to an alternative provider, however you will find that some insurance providers are happy to pay this fee on your behalf just to secure your business.

Hopefully the hints and tips above will enable you to reduce your home insurance costs and put a bit more cash back into your pocket.