Holiday home and investment property owners can save up to 50 per cent on buildings and contents insurance by shopping around, according to a sample survey conducted by The Sunday Business Post. For example, insurance premiums ranged from EUR646 (Axa) to EUR441 (FBD) per year for a three-bedroom holiday home in Dunmore East. The only snag is that most insurers will not quote for buy-to-let or holiday properties on a standalone basis.
Real estate owners will also have to switch their home insurance policy to the same underwriter, in order to avail of the more competitive rates. However, this could be a profitable exercise for multiple property owners, as average house insurance rates have fallen by about 5 to 10 per cent in the past year, according to Hibernian. A home insurance survey conducted by the Irish Financial Services Regulatory Authority (IFSRA) in August, revealed price differences of up to 50 per cent between insurers. If you're lucky, you might be able to more than halve your annual insurance bills by shopping around.
Surprisingly, online broker www.123.ie is the only provider of standalone investment and holiday home property insurance in the survey. "We're in a more competitive position than last year, when Eagle Star used to quote on a standalone basis. We negotiated an exclusive deal with Allianz," said Derek Richardson, chief executive of Richardson insurance and 123.ie.
Many people seem to consider shopping around for house insurance only when their renewal letter arrives by post. But, for property owners who are inundated at that time, the good news is that you can shop around and switch insurance providers at any stage. Naturally, this assumes that you pay your bill monthly by direct debit and not via an annual lump sum. Is there a large difference between insurance costs for family homes and other properties?
Property owners will be interested to learn that it costs about 25 per cent more to insure a buy-to-let property than it would to purchase cover for an identical family home. As one might expect, the insurance risks with rental properties are significantly higher than owner-occupied homes. Students who throw parties and irresponsible tenants don't have impressive claims histories.
The fact that holiday homes will cost about 50 to 70 per cent more to insure than an identical family home might also cause surprise. The reason for such price differentials is the claims record. Statistically and unsurprisingly, owner occupiers take better care of their properties. Holiday homes, which are visited in the summer and abandoned during the winter, might experience burst water pipes during freezing weather, as they are unattended for long periods. Fire damage and break-ins are higher on the risk list than for a family home or an investment property.
Intermediaries say that underwriters of investment properties prefer families as tenants, as they are statistically a better claims risk. In reality, a large proportion of tenants will be singles or couples but if you can rent to a family, actuaries can prove they are usually better tenants. What about property cover for apartment owners?
Some insurers steer clear of properties held for residential letting and those who do quote will often only cover buildings and contents as a package and not in isolation. This becomes unnecessarily expensive for apartment owners, as their buildings insurance is often included in monthly service charges.
Tip
Landlords can overcome this problem by locating the insurer who underwrites the building, as the insurance typically covers the contents as well. Only a quarter of all investment properties are apartments (according to Bank of Ireland data) but there are many landlords who rent houses. The insurance industry has entered a more profitable phase and, as a result, there is increased underwriting capacity being offered industry-wide. Property owners can hope that increased profits will attract more entrants to the market and produce keener pricing as a result.
Real estate owners will also have to switch their home insurance policy to the same underwriter, in order to avail of the more competitive rates. However, this could be a profitable exercise for multiple property owners, as average house insurance rates have fallen by about 5 to 10 per cent in the past year, according to Hibernian. A home insurance survey conducted by the Irish Financial Services Regulatory Authority (IFSRA) in August, revealed price differences of up to 50 per cent between insurers. If you're lucky, you might be able to more than halve your annual insurance bills by shopping around.
Surprisingly, online broker www.123.ie is the only provider of standalone investment and holiday home property insurance in the survey. "We're in a more competitive position than last year, when Eagle Star used to quote on a standalone basis. We negotiated an exclusive deal with Allianz," said Derek Richardson, chief executive of Richardson insurance and 123.ie.
Many people seem to consider shopping around for house insurance only when their renewal letter arrives by post. But, for property owners who are inundated at that time, the good news is that you can shop around and switch insurance providers at any stage. Naturally, this assumes that you pay your bill monthly by direct debit and not via an annual lump sum. Is there a large difference between insurance costs for family homes and other properties?
Property owners will be interested to learn that it costs about 25 per cent more to insure a buy-to-let property than it would to purchase cover for an identical family home. As one might expect, the insurance risks with rental properties are significantly higher than owner-occupied homes. Students who throw parties and irresponsible tenants don't have impressive claims histories.
The fact that holiday homes will cost about 50 to 70 per cent more to insure than an identical family home might also cause surprise. The reason for such price differentials is the claims record. Statistically and unsurprisingly, owner occupiers take better care of their properties. Holiday homes, which are visited in the summer and abandoned during the winter, might experience burst water pipes during freezing weather, as they are unattended for long periods. Fire damage and break-ins are higher on the risk list than for a family home or an investment property.
Intermediaries say that underwriters of investment properties prefer families as tenants, as they are statistically a better claims risk. In reality, a large proportion of tenants will be singles or couples but if you can rent to a family, actuaries can prove they are usually better tenants. What about property cover for apartment owners?
Some insurers steer clear of properties held for residential letting and those who do quote will often only cover buildings and contents as a package and not in isolation. This becomes unnecessarily expensive for apartment owners, as their buildings insurance is often included in monthly service charges.
Tip
Landlords can overcome this problem by locating the insurer who underwrites the building, as the insurance typically covers the contents as well. Only a quarter of all investment properties are apartments (according to Bank of Ireland data) but there are many landlords who rent houses. The insurance industry has entered a more profitable phase and, as a result, there is increased underwriting capacity being offered industry-wide. Property owners can hope that increased profits will attract more entrants to the market and produce keener pricing as a result.
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