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Switching home insurance - How to cancel & Pick a new policy

Switching home insurance illustration

Around two-thirds of households with home insurance have not shopped around to see if they can get a better insurance policy from a different company. It is worth taking some time to look at the nitty-gritty of how you protect your home and valuables to see if there are better home insurance quotes out there. By doing so, both your peace of mind and wallet will thank you.

Contents:

  1. Can you cancel home insurance mid-policy?
  2. Exit and cancellation fees for home cover
  3. Switching without hassle - avoid auto-renewal
  4. Home Insurance Policies - What to look for
  5. Home, building and contents insurance - Which one do you need?
  6. Details that matter for your insurance premiums
  7. Six top UK insurance companies


Can you cancel home insurance mid-policy?

home insurance contract

Before going any further, you need to find your insurance policy documents. If you don’t know where you put them do not fret because you can easily find them in PDF format online or by searching your email for them in the first few emails you got from your insurer.

  1. Look for a document called a policy booklet or summary.
  2. Open up the PDF and look for the Payments, Fees, Renewals, Cancellations section in the contents page.

In that section you will find all you need to know about whether cancelling mid-policy will cost you anything and how it could impact any claims.

Exit and cancellation fees

calculating insurance fees

Most insurance will have cancellation or exit fees that can reach £50 to just to end your contract with them so you can switch to another insurance company. This will happen regardless of your circumstances at any time beyond the initial 14 day cool off period. Aside from how much the exit fee will be it is important to know what the cancellation conditions are like the back of your hand:

  • If you haven’t had an insurance claim with your current company, then the cancellation will be deducted from your outstanding insurance premium that often gets refunded back to you. This is especially the case if the policyholder paid yearly instead of monthly.

  • If you have had to make a claim, then the cancellations procedure is not as straightforward because of the underwriting cost of your policy. You will either have to pay the remainder of your policy instalments until the renewal date or have the claims payment being deducted from the policy premium refund.

The bottom line is if you haven’t filed a claim during the duration of the contract, you only need to worry about whether the exit fee cancels out any savings that switching might bring. On the other hand, if you have filed a claim you want to tread lightly and read your policy documents carefully before making any decisions. However, the safer bet will be to wait it out so you don’t get hit with a deductible.

Switching without hassle - avoid auto-renewal

Home insurers and underwriters thrive on their customers’ apathy, confusion and forgetfulness. This is why policies are set to automatically renew by default at the end of the contract. While this may be buried in your policy details, it is vital that you opt out of it so that you are not locked into a contract with the same company for another year against your will.

always read the fineprint illustration

The moral of the story here is to cancel automatic renewal as soon as you sign up for any type of home, building or contents insurance, whether you pay monthly or annually. To do so, you will have to contact your insurer to make sure they free you from this underhand requirement.

Once that’s done make sure you set a reminder for the end of your policy so you know when to switch and don’t leave yourself exposed to an unexpected catastrophe if you forgot to find a new insurance policy.

Bear in mind that British households could collectively save £2 billion a year if they switched insurance more often. The biggest hurdle to looking for a better plan is auto-renewal locking you in.

Home, building and contents insurance - Which one do you need?

Home Insurance

Insurance companies provide different kinds of cover for your car, your holidays and your home. If you take a closer look at the details, you will see that not all policies are created equal.

perfect home illustration

Some may cover you if your household is a casualty of vandalism while others may not be so thoughtful. When it comes to a natural disaster you may find yourself covered during a hurricane, however unlikely one may be in the UK, but be left out in the cold when it comes to hail damage to your greenhouse.

However, the insurance sector divides up their cover primarily between buildings and contents. Some home insurers will offer both under one policy while others will differentiate between the two.

Buildings Insurance

If you only have this kind of insurance then you will be covered for the construction cost of your home, however not for what is inside your home, which would not count in a potential claim. Buildings insurance is compulsory for homeowners. If you are renting your property then it is extremely unlikely you would be liable for any building damage.

building insurance protection

Ask yourself this, if the home you own was to be torn down completely, how much would it cost to rebuild it to the last brick and tile? If you have a regular house with brick or stone walls and a tile or a slate roof then the BCIS Rebuild Calculator, endorsed by the Royal Institution of Chartered Surveyors, gives you an accurate estimate.

If you live in a listed home or in a building that is non-standard, such as a unique architect-designed house, then a chartered surveyor is a must to get the most exact cover valuation.

Just remember that this figure is what your house is worth unfurnished without anything inside. To protect what is inside you need another type of insurance: contents insurance.

Contents Insurance

You need to have contents cover insuring not just your valuables over £1000 but also day to day items like your cutlery, your furniture and rugs to name but a few of your favourite things.

home flooding damage illustration

Imagine your home flooded and everything inside is completely ruined, think about what the total replacement cost is for everything that is in the home, even if it is attached to your walls or floors. By doing an inventory estimate, you will know the amount of contents cover you need to effectively protect every possession you own.

Use our home valuation calculator and see how much contents insurance you need

Home Insurance Policies - What to look for

While obvious misfortunes like theft get covered by all kinds of insurance, there are a number of mishaps and situations that might not immediately come to mind but you should ensure you are covered for them as well. These generally fall under the additional cover section:

    man considering options illustration
  1. Legal expenses cover helps if you need to retain the services of a solicitor or barrister regarding a housing, property, possessions or liability dispute.
  2. Away from home cover lets the policyholder extend protection to valuables whilst you take them out of your home when you go on holiday, for example. Think prosumer cameras and laptops as likely candidates for this option. This one is also handy for families with university-age children living away from home, since their belongings can be also included.
  3. Accidental damage is the most obvious of these coverage provisions since it protects your belongings from damage caused by unintentional mistakes and actions. This one is a must if you have children.
  4. Home emergency cover ensures timely priority service in case your roof starts leaking, a water pipe bursts or your electrical wiring goes haywire. Instead of having to find someone yourself, your insurance company can send someone to make repairs quicker and cheaper.

Details that matter for your insurance premiums

If you are choosing to stay with your current insurer then these life events and changes in personal circumstances can impact your insurance premium and eligibility:

  1. Children, relatives or lodgers moving into your home
  2. Name changes due to marriage or divorce
  3. Starting a new job
  4. Moving into a new home
  5. Extensions, sheds or greenhouses added to your home
  6. Bathroom or kitchen refitting
  7. Your house getting a listed or other historical classification
  8. Getting a burglar alarm fitted
  9. Setting up a business in your home (even just baking pies for the local church).

Six top UK insurance companies

LV Insurance

LV insurance logo

A British company that started in Liverpool during the industrial revoltion. They currently have 5.8 million customers for all kinds of insurance, from car to life insurance. Their home insurance is fairly competitively priced but it is worth looking into what it includes to see if it is suitable for you.

Reviews & Details

Ageas

Ageas insurance logo

Belgian insurance giant that provides service in over a dozen countries including the UK where they are especially well known for their car and travel insurance. Their customer service reviews are split down the middle suggesting uneven service quality.

More Information

AXA

Axa insurance logo

An insurance powerhouse that operates all around the world and also provides financial services. They underwrite many insurance policies even for their competitors. If you are looking for an insurance kingpin with a lot of customisable options then you should look at what AXA has to offer.

More Information

Covea

Covea insurance logo

A company that specialises in property and liability cover. They came to the UK in 2012 and acquired British insurance brands, Provident and Gateway to build up their operations. Covea are serious when it comes to protecting your property with around 1.2 million UK policyholders counting on them for insurance services.

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Legal & General

Legal and General insurance logo

They are the biggest insurer in this list to remain in British hands. They offer a wide array of insurance cover from home to pets and additionally they also deal with investments and retirement. They have been in operation since the 1800s and have expanded as far as the United States. Their customer reviews are mixed and vary widely according to the types of insurance.

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Aviva

Aviva insurance logo

Another insurance multinational with headquarters in London and historied British roots. Like several of the companies on this list home insurance is just one of the many services they offer to their customers in the UK and beyond.

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