Peterborough householders should expect healthy drop in home insurnace premiums due to Covid

The UK home insurance industry is estimated to have saved £368,326,000 over 2020, thanks to the Covid-related restrictions taken across the UK almost all year long.

With many people forced to stay home for months, domestic incidents decreased in a significant proportion since the beginning of 2020.

This is equates to a drop in insurance claims of 16.76 per cent in Peterborough and the East of England region during the first lockdown, according to insurnace comparison platform Hello-Safe.co.uk

That equates to an estimated £32,185,935 in home insurance savings over 2020.

The biggest savings have been in the North East of England where insurance claims are thought to have dropped during the first lockdown by 17.94 per cent, saving £14,680,303 in pay outs.

A Hello Safe spokesman explained that with so many having to stay at home, either working, on furlough or looking after kids unable to go to school – people avoided or lessend many of the usual damages happening – whether being theft, water damage or other classic domestic damage that often occurs when the house is empty while people are away at work.

For example residential burglaries decreased significantly across the UK. The comparison site said according to crime figures, number of burglaries dropped by 37 per cent during lockdown 1, and should drop by 13.3 per cent over the full year of 2020 – meaning £47.6 million was saved nationally by the home insurance industry on this unique item.

Water-related claims are expected to decline by an overall 13 per cent over 2020 in comparison with 2019, which means £97.8million will be saved on home insurance payouts related to this kind of damage by the industry.

The below graph shows on which extent home insurance claims have dropped:

The East of England has the fourth highest total estimated savings on home insurance pay outs expected in 2020 at £32,185,935.

But the question is, should the home insurance industry repay some of the money if we have all been at home standing guard over our properties due to Covid-19?

Hello Safe says home insurance premiums in the UK have been constantly increasing (actually by 27 per cent over the last three years according to comparison site giant Money Supermarket) and represent a significant expense in households’ budget – with an average £153 annual premium for British households.

If not a refund, home insurance policyholders should expect a passed-on decline in their premiums – at least for 2021. Hello safe say that would be a fair gesture from the industry, when the country is just entering an unprecedented economic crisis that may last several years.

Antoine Fruchard, insurance expert and CEO at Hello-Safe.co.uk said: “It is not a surprise to see that home insurance claims have decreased in the significant way over 2020, with most Britons stuck at home during a year where very restrictive measures were taken to stop the Covid-19 pandemic. Indeed, as we observed with car or health insurance products, the payouts made by home insurers have gone down.

“However, until now, the industry has taken no decision to give back some of the savings made to the policyholders. This is a questionable position, when the impact of the economic crisis is just starting to strike most of the British households, and could last for years.

“Moreover, many workers will now make the decision to work from home, fully or partially. For those remote workers, the insurers will surely have to adapt and propose new solutions. Indeed, the future of home insurance is still to create”.