Are you spending more on your home insurance than you should be? Confused.com has just announced results of its research suggesting that, on average, customers are annually spending £96.43 more on their home insurance policies than they need to through failing to switch providers. That means as much as £1.7 billion is being wasted across the UK each year in unnecessary insurance premiums.

Confused.com’s research found that:

• 40% of home insurance customers have not switched at all in the last three years or more
• 5% of customers haven’t switched for 10 years or more
• 13% of customers have never switched providers

So why are people so reluctant to switch providers? With numerous comparison websites now available it only takes a few minutes to look for a better deal, and almost £100 a year is not to be sniffed at. Confused.com looked into this as well and found that:

• 39% of respondents said they had a great insurance deal and didn’t need to switch
• 20% can’t be bothered to switch
• 19% didn’t think the savings on offer made switching worth the effort

Perhaps the most surprising thing to come out of the research was that 4% of respondents didn’t even know that they could switch providers. With so much publicity at the moment about switching providers to get a better deal in this tough economic climate, it is amazing that some people are still not aware that they can change their providers.

If you do switch, remember that you should not make your decision on price alone because it is also essential that the cover is appropriate for your needs. Mark Gabriel, the head of home insurance at Confused.com, said that “levels of cover can vary between providers so check everything you want is covered and then select a policy that meets your needs”. He also added that it is good practice to do this every year to ensure you have the appropriate level of cover at a good price.

The true extent of damage caused by the cold weather in December 2010 has been revealed by the ABI (Association of British Insurers). It has just released details suggesting that insurance companies have forked out a massive £1.4 billion to cover the damage.

To put this into perspective, that is more than twice the amount paid out in insurance claims the last time the country suffered a bout of freezing weather (£650 million).

From properties to vehicles to businesses, nothing was spared from the sub-zero temperatures and heavy snowfall that hit the UK throughout December. Low-speed vehicle collisions and burst pipes were some of the biggest problems, with burst pipes alone responsible for 100,000 claims at a cost of £680 million.

In total, there were 478,000 claims made during the spell of freezing weather. 190,000 of these were for home insurance, totalling £900 million, and the rest were claims on car insurance policies, making up a total of £530 million.

The director of general insurance and health at the ABI, Nick Starling, said that “when bad weather strikes there is no substitute for insurance”.

He added that even though it had proved to be a very costly time for insurers, they would do all that they could to keep prices competitive. As of this moment it does not appear that premiums have gone up as a result of the bill, and hopefully it will stay this way.

It is of course a legal requirement to have car insurance but if you are in any doubt about the need for home insurance then this could be a good reminder of the huge bills that you can face if you don’t take out the appropriate cover.