You are never too old to take a long, hard look at how much you are paying for your home insurance. Indeed, if you are over 50, recent press reports suggest that you might be paying more than you need for this essential safeguard.
Certainly, cheap home insurance does not have to be a thing of the past simply because you have reached your 50’s.
In fact, some insurers will reward ‘older’ home insurance customers as the over 50’s are seen as more sensible – i.e. keeping the home well maintained (so less chance of a leaky pipe going unnoticed) and not making claims for smaller amounts – things which can all push up the cost of your cover.
But assuming you are always getting the most attractively priced home insurance could be a mistake. Here’s why …
On the 17th of January 2018, the Sun newspaper cited an alleged scam by some home insurance providers who are charging customers who have insured their home with the same company for more than five years up to twice the price that new customers need to pay.
This so-called “loyalty tax” is the subject of a complaint to MPs from the energy supply regulator, Ofgem, that failing to switch home insurance providers is likely to prove more costly than making a similar comparison with your gas and electricity supplier and switching.
The Sun’s story echoes warnings previously made by Sky News on the 24th of November 2017, which followed up survey results published by the advice service Citizens’ Advice. This also referred to the “loyalty penalty” currently being paid by an estimated 13 million households who have failed to compare home insurance prices, taken no action to switch providers and, so, ended up paying more than they might otherwise have to do.
The majority of those penalised customers are the elderly, argued Citizens’ Advice, since they are perhaps less likely than others to tackle the inertia of staying with their chosen insurer and switching to an alternative provider of cheap home insurance.
Over 50s home insurance
The overwhelming lesson to be taken from reports such as these is that it is imperative to never automatically renew without first comparing home insurance prices and, if necessary, switching insurers.
For those aged 50 and over, some insurers offer specialist over 50 home insurance, which is promoted as a cheaper option than standard home insurance policies for those in this age band. Even so, some insurers may still offer more affordable deals to the over 50s, compared to others, so you do still need to compare house insurance deals.
How to compare home insurance
Shopping for cheap home insurance might involve your focusing on products designed explicitly as over 50s home insurance or it might not – the key lies in finding the cover that matches your specific, individual needs and circumstances at a competitive price.
Things to note include:
- buying a combined home buildings and contents insurance policy may work out cheaper than buying two policies from two different providers;
- paying a voluntary excess on top of the mandatory excess (the excess is the amount that you are liable for in the event of a successful claim);
- make sure you compare policies on a like-for-like basis. For example, some will include subsidence cover as standard while others may not, etc.
Tips on reducing your costs