Making a home insurance claim ‘can drive up policy costs by more than 50%’

Making a single home insurance claim can drive up the cost of a policy by more than 50%.

Home insurance customers who have made one claim face paying 57% or £91 more on average than those who have not claimed, according to analysis published by Which?

Those with no claims pay £161 on average while those who have made a claim can expect to pay around £252.

Those with two home insurance claims could expect to pay £359 on average – an increase of £198 compared with a policyholder who had made no claims.

This compared with an average increase of £69 for drivers who had made two recent car insurance claims. Motorists who had made two previous claims faced paying £955 for cover on average.

One reason for home insurance customers facing steeper price hikes for making a claim than car insurance customers could be the expenses involved in putting the situation right.

Among the home insurance claimants, the most commonly reported reasons for claiming were accidental loss or damage, escape of water and thefts – all of which could mean complex or costly replacements, or potential concerns about the security of the property.

The three most commonly reported car insurance claims were accidents where the driver was at fault but there were no injuries, “non-fault” accidents and single-vehicle accidents.

Which? was helped by comparison website GoCompare to look at averages of millions of quotes received by drivers and households using its service between January and August 2021.

Ryan Fulthorpe, car and home expert at GoCompare, said: “Making a claim on a car and home insurance policy will almost certainly increase your premiums the following year. And having looked at the data, it shows that the more claims you make, the more it will impact the price you pay.”

The research also found that, among car insurance customers, drivers who had made one claim were paying £81 less on average than those who had not claimed before.

A possible explanation is that drivers who take the time to shop around for better deals can avoid paying more, those behind the study suggested.

Jenny Ross, editor of Which? Money, said: “You might decide it’s not worth claiming at all, but insurers can ask you to disclose incidents that could have led to a claim. Honesty is always the best policy, otherwise your insurance could be invalidated.”