The average cost of home insurance has increased by 6% since the start of last year, according to moneysupermarket.com, taking the typical premium for buildings and contents cover up from £142 to £151.
Compared with premium inflation for car insurance (up 31% on 2010 levels) the rise seems minimal, however, insurers need to recoup the cost of last year’s freezing winter weather and with severe weather occurrences in the UK becoming a trend, the cost of insuring homes could be steadily on the increase.
According to the price comparison website, another factor hitting policyholders hard is the rise in fraudulent claims, which add around £44 to every premium, data from Legal & General suggests.
Moneysupermarket’s head of home insurance, Julie Owens, comments: “Things look set to get worse with the increase in prices unlikely to slow down in the coming years.”
According to Ms Owens, double digit percentage increases are on the cards.
Fitch Ratings says in a newly-published report examining the insurance industry’s possible exposure to the 11 March earthquake in Japan that it does not expect significant negative rating action as a result of the event due to a number of loss mitigating factors. The report expands upon the comment issued by Fitch entitled “Japanese Earthquake Losses Manageable for Primary and Reinsurance Companies” dated 13 March 2011 at www.fitchratings.com.
The agency believes that losses can be absorbed by the insurance and reinsurance industries without any widespread solvency problems, or undue financial strain. Howev
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Insurance company share prices have fallen sharply this week as estimates of the cost of Japan’s earthquake and ensuing nuclear emergency have risen. Shares in the global “full-line” insurance sector were down nearly 6 per cent in the five days following the earthquake, while the global reinsurance sector fell more than 4 per cent.
Although much of the cost will be carried by the Japanese government and local Japanese insurers, reinsurers including Swiss Re and Munich Re, and even UK insurers – such as Aviva and Prudential – have seen their shares hit as concerned investors sold out of their holdings.
Sh
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Aviva has reported a 30% year-on-year rise in claims resulting from residential cannabis farming and is warning landlords to be extra vigilant.
According to the insurer, there were 758,700 cannabis plants seized by the police in 2009/10, a rise of 18% on a year earlier.
Eighty-three per cent of seizures were for 50 plants or fewer and Aviva settled 92 cannabis-farming claims, the highest number since the group began collecting data in 2007.
The insurer’s underwriting manager, property owners, Matthew Gordon, comments: “Almost all of the properties were residential and we often find that it is part of a larger operation or that the policyholder has had a couple of properties affected.”
He adds: “Cannabis farming comes with serious risks for landlords; properties can be completely ruined inside to make space for plants, water damage can occur and fire poses a risk due to interference with electrics or strong lighting left on for a long time.”
The cannabis farming tenant will often line walls, ceilings and doors with plastic or polythene, and windows will normally have blinds or curtains closed to obscure any activity.
T
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Millions of men approaching retirement could be left thousands of pounds worse off if a European court rules on 1 March that insurance companies can no longer use gender to calculate annuity rates and insurance premiums.
Young women drivers will also be hit hard if “gender discrimination” is ruled illegal. An Association of British Insurers research paper claims some under-25s may face motor insurance increases of between 50% and 60% almost overnight – which could translate into an extra £500-£1,000 a year.
Many in the UK insurance industry believe it is likely the European court of justice (ECJ) will ban insurers from taking a person’s sex into account when setting premiums. Such a ru
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Arc Legal Assistance is claiming a UK first with the launch of its iPhone claims app for legal expenses policies.
The company also has plans to develop its existing online claims offering to give customers access to online legal documents, legal guidance notes and a “frequently asked claims questions” section.
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