Why Is Home Insurance so Expensive in 2025?
Most UK home insurance remains higher in 2025 because claim costs and risk have risen. Repeated storms have driven larger weather related payouts, and repair costs are still elevated after spikes in materials and labour. Pricing also reflects postcode level flood and crime risk and any recent claims, with some insurers tightening underwriting or restricting cover in higher risk areas. To pay less, compare at renewal, check your rebuild sum, improve security, and consider a higher voluntary excess.
According to the Association of British Insurers (ABI), record UK weather claims in 2024 totalled £585 million, due to 12 named storms in the 2023 to 2024 season.
After a volatile year, clarity helps. rivr’s digital first home insurance combines buildings and contents into a single, straightforward policy, built for high value homes, with optional specified items and accidental damage.
What is home insurance pricing?
Your premium is the amount you pay for a year’s cover. Insurers set it to reflect the expected cost of claims for your home over the next 12 months, combining broad market trends with signals specific to your property.
Key drivers include:
- Postcode flood and crime risk
- Rebuild cost
- Property features
- Security
- Recent claims
- Chosen excess
- The cover options you select.
Insurer appetite can shift, so prices may change at renewal even if nothing else does. Paying monthly uses premium finance, which adds interest charges but does not change your base premium
How key factors affect typical UK home insurance premiums
Reviewed 23 October 2025
Sources: ABI, Go.Compare, Which?, MoneySuperMarket, Insurance Business UK.
How much have home insurance premiums increased in the UK?
Prices have eased a little from their 2024 peak but remain elevated versus 2022. The average price paid for a combined home policy was £391 in Q2 2025, £2 lower than Q1, according to the ABI’s Property Insurance Premium Tracker.
Consumer Intelligence reports prices on comparison sites fell for four straight quarters to June 2025 as competition returned.
Weather pressure remains, with a record £585 million paid for home weather claims in 2024, per the ABI.
According to ABI’s Policy Adviser, Louise Clark, the sharp increases homeowners have experienced in premiums reflect ongoing market uncertainty.
Prices differ greatly by region. The ABI tracker does not publish a 2025 regional breakdown of price paid premiums, so we avoid regional percentages.
Why UK home insurance premium are rising in 2025
Inflation and rising building costs
One major factor driving the cost of home insurance upward is inflation. British insurers have faced higher expenses for materials and labour, impacting the total amount insurers paid out per claim. Supply chain disruptions, notably since the COVID-19 pandemic, mean repair work often takes longer and costs significantly more than in previous years.
With labour costs steadily increasing throughout 2025, insurers have faced higher expenses when paying claims, subsequently driving premiums upward.
As insurers face higher bills for repairs, homeowners inevitably see their premiums increase as companies look to cover these added expenses.
Increased frequency of extreme weather events
In the past years, the UK has experienced more frequent and bad weather conditions, including flooding, storms, and damaging cold snaps. Each event results in substantial claims for weather-related damage, escalating the total claims paid by insurers compared to last year.
With predictions suggesting these trends are here for the long run, insurance companies have adjusted their risk assessments, consequently raising premiums to protect their profitability.
Changes in the UK insurance market
Another critical reason behind rising premiums is the ongoing shift in the insurance market itself. Some providers are pulling out of markets considered too risky, notably flood-prone or coastal regions.
The withdrawal or reduced capacity of certain insurers lessens competition, driving prices up for homeowners who find fewer options available for competitively priced home insurance.
This tightening of underwriting standards means homeowners in affected regions often see higher renewal prices, highlighting the importance of regularly reviewing their policy details.
Many insurers now offer higher renewal quotes to existing customers, reflecting a cautious approach due to sustained market volatility and frequent claims experience.
Regional risk factors
Specific local risks greatly affect home insurance costs. For example, homes in flood-prone areas or regions experiencing frequent storm damage, like East Anglia and parts of Scotland, naturally attract higher premiums.
Similarly, properties in areas of Greater London facing higher crime rates or those particularly exposed to coastal erosion can see premium spikes.
Insurers continually reassess these regional risks, which directly impact the amount homeowners pay each year.
Which factors affect my home insurance cost?
Besides broader economic factors, individual circumstances heavily influence the cost of your cover. Here’s how personal aspects can alter your insurance policy cost:
- Claims history: Frequent claims in the same period significantly raise your renewal price.
- Property type: Larger homes or detached properties generally incur higher premiums due to increased rebuilding and contents valuation.
- Home security: Enhanced security measures can lower premiums by reducing your risk profile.
- Credit information: Insurers consider financial stability as an indicator of risk, potentially influencing your policy pricing.
Opting for combined buildings and contents insurance, and paying annually rather than monthly can help homeowners secure better rates and save money.
What can UK homeowners do to manage rising premiums?
Amid rising premiums, it’s crucial for homeowners to proactively manage costs. Here are several effective strategies:
- Regularly compare providers: Shop around every renewal cycle through reputable comparison platforms or brokers, ensuring you get competitively priced home insurance.
- Review your coverage: Assess your existing policies carefully (whether it's contents insurance, buildings insurance, or a combined policy) to ensure you're only paying for the cover you truly need. You may be better off buying standard buildings insurance and specialised high-value contents insurance with a different provider.
- Enhance home security: Improved security systems, like alarms or advanced locking mechanisms, can notably reduce your premium costs.
- Consider higher excess: A higher voluntary excess may significantly reduce your annual insurance costs, but always balance this with affordability if a claim arises.
Homeowners looking to insure their properties for a lower price should regularly compare providers. Using reputable comparison sites can help you find better value for your money, but these tend to only serve the standard insurance market.
By adopting these measures, homeowners can mitigate the financial burden of rising home insurance premiums.
Checklist
Takeaway
In 2025, UK homeowners are facing a more challenging home insurance market. Inflation, rising labour and material costs, supply chain delays, and more frequent extreme weather events have all contributed to a significant increase in premiums. Insurers are paying out more in claims, reassessing risk levels, and adjusting their pricing to reflect current conditions.
Understanding the reasons behind these increases is essential. Homeowners who stay informed are better equipped to make confident decisions about their policies and to identify ways to reduce costs without compromising on cover. Regional factors such as flooding or high crime rates, changes in the insurance market, and individual risk profiles all play a role in what you pay.
While further price rises may occur in the coming months, there are practical steps you can take to manage your costs. These include improving home security, reviewing your coverage regularly, considering a higher excess, and comparing providers at each renewal. Tailoring your policy to your actual needs, rather than relying on default cover, can make a real difference.
*This article reflects market data and expert insights available at the time of review (October 2025). Insurance conditions may change, and this content is for general information only. It does not constitute personalised financial or insurance advice. Please consult a qualified adviser for guidance specific to your circumstances.
rivr: cover for those with more to protect
At rivr, we understand that rising home insurance premiums can be challenging. As a high-value home insurance provider, we do things differently, offering a digital-first, specialist service that fits your lifestyle. Whether it's contents cover, buildings insurance, or a combined home policy, we ensure you get reliable cover without unnecessary hassle or costs.
Contact us today to see how we can help.
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Frequently asked questions
Yes, most insurers will charge you more if you have claimed recently, this is so it is able to charge those with better claims history less.
The rising costs for building materials and labour delays increase the amount insurers paid per claim, leading to higher premiums.
Northern Ireland has seen the largest rise, at 31%, closely followed by London, South East England, East Anglia, and Scotland.
Premium increases have begun to slow, but prices are still expected to rise in 2025. Industry analysts at EY forecast an average increase of around 5%, driven by ongoing claims costs, inflation, and supply chain pressures. However, if inflation continues to stabilise and weather-related claims stay within normal levels, the rate of increase could ease further. Some signs suggest the market may begin to soften, but homeowners should still plan for higher premiums this year.
