Insurance renewal reality check

[tobydog]

Our house renewal with NFU is due in early March. We've been with them since March 2009 when we bought our current house. The bottom line issue is that the premium in 2009 was around £400 per annum and the renewal has been increasing ever since. From March this year it will be £1,064. I've had to go to war with them every year and, in many cases, they have amended their premium. In March 2018 they wouldn't budge on their renewal premium of £890 and I've yet to talk to them about the £1,064 for 2019.

In my mind I have a feeling that this isn't actually all that bad. Our circumstances are:

Age - roughly 1640
Construction - timber frame and brick with 70% thatched roof (the old part) and 30% tile to the new hall linked extension
Size - 2 bedroom / 3 receptions and detached
Status - Grade II listed
Rebuild Cost - £350,000
Wood burner - yes but only used as back up to main oil fired system

We know we can reduce the premium by a few hundred pounds by removing the wood burner. NFU literally got their fingers burned with these things and clients are still paying the price in premium.

I should add that I've started looking around at option but all applications / new insurer coverage want evidence of a 10 year electrical safety check. Whilst we have had electricians all over our house doing new and upgrade work, we don't currently have a certificate. I've asked our current electrician for a quote to carry it out.

Does the £1,064 renewal premium sound reasonable?

Thanks

 

[Pennyviz]

Last year LV cost me less than £500 for grade 2 listed, building and contents up to £1M. 4 bed stone, mixed dates of construction but before 1900.

Penny

 

[skier-hughes]

Is the rebuild cost a like for like rebuild cost?
Our house has a resale value of about £700k but has a rebuild price of around £1.5m.
Our premium is around £1600.
The reason given is that if the house was half destroyed and we wanted it back to how it is, it would cost considerably more to source the right materials. If it was totally destroyed we'd have a new house built and that would only cost about £300k.

If that helps????

 

[tobydog]

Thanks for the responses. The rebuild cost has been index linked to a rebuild cost were given in 2009. I agree that the partial loss is always going to be the bigger expense. Being Grade II listed it would be interesting to know what would be required in the event of a true total loss. A pastiche? Given that the lower back and side walls are solid brick, and we have a huge oversized inglenook, the likelihood of an actual total loss is unlikely. They'll work with what is left. I know that the thatch, wood burner, timber frame and listing are the equivalent of a perfect storm!

 

[TheSpid]

Aviva. 1750 ish stone build with timber internal frame, unlimited rebuild cost - NOT listed [maybe the difference] £175 a year

 

[malcolm]

Mine is a bit fiddly as it is still transitioning from a commercial building to a house so I'm limited on policies. I'm paying around £700/year on a big place with 4 beds and maybe 4 reception rooms, not listed but in conservation area, and some timber frame but no thatch. Rebuild cost about £500k I'm only really interested in insuring it against total or near total loss as otherwise I would prefer to make my own repairs. Good to know there will be cheaper options once it becomes a house.

 

[philpjuk100]

Swinton sent me a letter telling me that they could save me £250 on my premium,I phoned them to see where to send the cheque.They said there would be questions!, Has it got a current house builders cert? no, is it old then? yes, it`s not pre-war, is it? yes, the civil war, Brick and tile? no timber-framed, oh that's nonstandard construction then! It wasn`t when they built it, is it near any watercourse?, well the Trent is at the end of the garden.I asked again where I should send the cheque and she hung up!

 

[steveb]

NFU - £322/year - non-listed farm workers 2 up 2 down, timber frame, slate roof, on a flood plain. (£1000 excess though, same as malcolm we treat this as "catastrophe insurance")

The flood plain is the killer - we're less than 400 yards from a main river and not very much above it. Even the "specialists insurers" are running away from this market it seems whereas the NFU chap obviously had some models as he spent a bit of time poking about and came to the same conclusion that the farmers who built the place 250 years ago did, that it probably wouldn't flood...

Hopefully for all of our sake he is correct. Neighbouring houses flood, but they are lower - not a lot, but once the river is half a mile wide it takes quite a lot of water to raise it the extra 6 inches :shock:

 

[Flyfisher]

Our circumstances are:

Age - roughly 1640
Construction - timber frame and brick with 70% thatched roof (the old part) and 30% tile to the new hall linked extension
Size - 2 bedroom / 3 receptions and detached
Status - Grade II listed
Rebuild Cost - £350,000
Wood burner - yes but only used as back up to main oil fired system

Does the £1,064 renewal premium sound reasonable?

For that rebuild cost the premium sounds expensive to me, but I have no experience of thatch. We're with NFU and our circumstances are:

Age - roughly 1550
Construction - timber frame with brick/rubble addition, brick/chalk block annexe, all under pantile roof
Size - Detatched 5 bed/3 reception with 3-bed self-contained annexe
Status - G2*
Rebuild cost - £1.4m
Wood burners x3 plus gas CH

For this we pay £1328 per year (actually £111 per month under NFUs 0% interest scheme), though it reduced last year even though our circumstances didn't change. Possibly something to do with their 'mutual bonus' scheme? Premiums for previous years were:

2014 - £1389 - Lark (changed to NFU when Lark renewal was about £2000)
2015 - £1395 - NFU
2016 - £1582 - NFU
2017 - £1602 - NFU
2018 - £1328 - NFU

 

[Flyfisher]

I'm only really interested in insuring it against total or near total loss as otherwise I would prefer to make my own repairs.

In that case, it might be worth checking if you can add a voluntary excess, or increase the existing one? I know this can make a significant difference to car insurance premiums, less sure about house insurance though.

 

[Flyfisher]

The flood plain is the killer - we're less than 400 yards from a main river and not very much above it. Even the "specialists insurers" are running away from this market it seems whereas the NFU chap obviously had some models as he spent a bit of time poking about and came to the same conclusion that the farmers who built the place 250 years ago did, that it probably wouldn't flood...

You can check your flood risk here, complete with a detailed map: https://flood-warning-information.service.gov.uk/long-term-flood-risk

We are in a similar situation; a hundred yards or so from a river that regularly floods. However, the ground on our side of the river rises to around 20 feet higher where our house is built, whereas the opposite side is flat, forming the actual flood plain. So while we have seen the fields opposite flood almost every year we've never had water anywhere near our house and I'm pretty sure that's been the case for the 450 years or so our house has been standing - after all, it's not really rocket science! :wink:

 

[steveb]

You can check your flood risk here, complete with a detailed map: https://flood-warning-information.service.gov.uk/long-term-flood-risk

We are in a similar situation; a hundred yards or so from a river that regularly floods. However, the ground on our side of the river rises to around 20 feet higher where our house is built, whereas the opposite side is flat, forming the actual flood plain. So while we have seen the fields opposite flood almost every year we've never had water anywhere near our house and I'm pretty sure that's been the case for the 450 years or so our house has been standing - after all, it's not really rocket science! :wink:

Ah if only we had that luxury - we're on a fen so the slope from river to our place is very gentle, so is classified as the functional flood plain. At Christmas 2014 the garden flooded to within about 20 feet of the house - however in order to raise the water by the extra 6 inches of height or so where it might start to become a problem, I would estimate that the amount of extra water needed would be enormous because the river is already half a mile wide at that point.

Regarding excesses, here are the numbers I got which might give you an idea of how premium may reduce with increasing excess. Since I only would claim for a catastrophe, I went for the £1000 excess..

Voluntary Excess Level Premium

£1000 £322.74

£500 £417.32

£250 £427.67

£100 £484.48

 

[88v8]

House c1620
GII
Thatched
House rebuild cost £600,000 which is a bit below market value.
Contents £30,000 which I am sure is ott.
Two woodburners in regular winter use.
No current electrical cert.
Premium £1,500.
Excess £100
With County Insce.

Last year it went up about a third. They blamed woodburner fires.
Most years premium has increased a few percent, last year was the greatest.

Thatch is an unbalanced portfolio, it only takes a few fires to make it unprofitable.

Did have a conversation with the local NFU office a few years ago at which time they were so much dearer there was no point getting into detail.

Ivor

 

[Flyfisher]

Thatch is an unbalanced portfolio, it only takes a few fires to make it unprofitable.

True, but isn’t this part of the problem? By dividing the market into smaller and smaller portfolios the risks become disproportionate, driving up premiums until ultimately you can’t get cover at all. Better, surely, to treat the housing market as a whole and spread the risks as widely as possible? I wonder what the annual house fire costs would be if spread evenly over the whole housing stock? Yes, I know, cloud cuckoo land.

 

[tobydog]

This subject always creates a bit of debate. The unbalanced portfolio issue has got much worse in recent years due to so many people now incorporating wood burners in thatched houses. Thatched house fires have always hit the headlines but more so recently. If our inglenook wasn't so disproportionally big we would take the burner out and simply put in a dog grate and a pile of logs. To make it actually work we would need a large hood fitted and that's likely to have a Hetas engineer saying we need a new stainless / insulated liner. It's way cheaper to keep the burner and pay the premiums, for now anyway.

I was given an interesting option a few years back by another insurer. Keep the wood burner but have a condition in the policy that it is never used. If a fire resulted from use of the burner, it wouldn't be covered. The premium difference with NFU was not enough to justify restricting ourselves, especially as we had a dodgy boiler at the time.

Ivor - I've just spoken with County Insurance and they're working on a quote. I'm amazed that insurers don't actually ask for photos of old houses. I spent several minutes trying to explain that our huge inglenook is only as high as the lounge ceiling. On top of this is a concrete base and a new (35 year old) chimney stack sits on top. Apparently this was done so that the upstairs was more habitable. It was listed afterwards!! The consultant asked me when the chimney was last inspected so I tried to explain why it wasn't necessary. She said they require an inspection every 3 years and I said I would expect that if the inglenook top was original and going through the thatch. Ours is from the 80's.

I'm actually starting to appreciate how NFU don't ask so many awkward questions.

 

[Flyfisher]

I was given an interesting option a few years back by another insurer. Keep the wood burner but have a condition in the policy that it is never used. If a fire resulted from use of the burner, it wouldn't be covered.

An interesting option but who would be the judge of the cause of any fire? Could open a can of worms if a claim was necessary, which would not be pleasant at an already stressful time.

 

[philpjuk100]

I have changed insurers most years as the premiums seem to rise on a second year, the first couple of years we were with the NFU but this quickly doubled. On the .gov flood plan we are on the line between low and medium (1% and 3%) before we purchased we asked the neighbors one that had lived there for 45 years and he explained why the garden floods but not the house ( the max water level is governed by the height of the far bank) One prospective broker asked loads of questions one being the hight of my doorstep above the summer water level (this was to set my excess) we had some archeologists digging in the garden so I got the surveyor to check and he measured it at 5.15 meters so we told the broker who then refused us insurance.My current insurance excludes flooding as this is the only way to get an affordable premium and I am willing to take that risk but I thought there was a government scheme to help folks in that position.

 

[MatthewC]

I'm now with Ecclesiastical Insurance (who do domestic houses as well as churches). They have a good understanding of what is likely to be left after a massive fire, and so their costs are more realistic rather than anticipating a ground up rebuild every time. My 19th C house is limestone with slate roof.

I was previously with Co-Op Insurance. I was worried that their premium was too low (!) because I thought that they might not appreciate the costs related to old buildings, even though they assured me that it was fine.

 

[88v8]

Ivor - I've just spoken with County Insurance and they're working on a quote. ....She said they require an inspection every 3 years, and I said I would expect that if the inglenook top was original and going through the thatch. Ours is from the 80's. I'm actually starting to appreciate how NFU don't ask so many awkward questions.

Expect they all have boxes to tick. Our renewal says every five years.

I generally find them helpful; before we moved here, in the six months while we were still living in our previous house, they were one of few insurers who would provide cover for what was in effect an empty house.
They sent a chimney engineer with a camera a couple of years ago, we got a clean bill. They sent us a copy of the survey. There was no charge, well of course there was but no separate charge.
They also require two sweeps per year, unless otherwise agreed, the second twixt 1.1. and 31.3. I've never asked how one sweep might be agreed, so after 1 Jan we effectively have no cover as it's quite apparent from the sweepings that two sweeps would be pointless. We also have no cover for electrical fires as we have no current cert. Hardly worth bothering with insce really, more a habit than a necessity.

I do intend to get a 3/4" hose for each end of the house though, the better to reach the roof if needs be.

By dividing the market into smaller and smaller portfolios the risks become disproportionate, driving up premiums until ultimately you can’t get cover at all. Better, surely, to treat the housing market as a whole and spread the risks as widely as possible? I wonder what the annual house fire costs would be if spread evenly over the whole housing stock? Yes, I know, cloud cuckoo land.

One can just imagine the fuss in certain quarters of the media, if Mrs Miggins in her ex-council house were subsidising Mr Plutocrat in his thatched country residence.
More practically, insurers want to cut their peak risks. And simplify their admin. Thatch is a risky niche. County tell me that few insurers will now cover woodburners at all.
If I were an insurer, I wouldn't. Ignorant users burning any old wood, no thermometers to check the flue temperatures, left burning unattended, dodgy installations.
A long-term thatch owner in the village moved out recently - 34 years - the new owners found there was no flue liner, so their hopes of a cosy Christmas were scuppered.
I back my own ability to run a woodburner safely, but I wouldn't wan't to insure anyone else.

Ivor

 

[Flyfisher]

By dividing the market into smaller and smaller portfolios the risks become disproportionate, driving up premiums until ultimately you can’t get cover at all. Better, surely, to treat the housing market as a whole and spread the risks as widely as possible? I wonder what the annual house fire costs would be if spread evenly over the whole housing stock? Yes, I know, cloud cuckoo land.

One can just imagine the fuss in certain quarters of the media, if Mrs Miggins in her ex-council house were subsidising Mr Plutocrat in his thatched country residence.

Well yes, although if the ‘thatch subsidy’ were spread evenly over 20 million homes (or whatever the UK figure is) it might only amount to a few pounds. Anyway, ‘subsidy’ is the very basis of insurance isn’t it? I know I’ve spent a lifetime ‘subsidising’ the repairs to other people’s homes, and their vehicles come to that, through my insurance premiums. As most of us have.