Home insurance premiums appeared to change very little over the first three months in 2008; however, it appears that insurers are still very wary about issuing quotes to their customers.

According to some information from a leading insurance company, the average cost for buildings cover fell by just 42p to the amount of £208.51. Also, the average of the lowest three quotes, or the “Shoparound premium” as it is also known, fell by only 34p. Another average looked at was contents insurance premiums that rose by only one per cent to £128.57.

The insurance company commented that they had thought premiums would continue to rise since the flooding last year. The company believe that the slight fall in the average cost of quoted premiums for buildings insurance is due to an increase in the number of risks that are not being specified by some insurance companies that would suggest sensitivity to flood risk.

The company do insist that this will not mean families could find that their homes are uninsurable. It will more likely mean that home insurance companies will ask more questions, for example, what your local authority is doing in order to provide flood protection, before they will give you a quote. Existing insurers are expected to provide cover for customers following a flood.

Under the ABI Statement of Principals for the Provision of Flood Insurance, the industry will continue to insure flood-risk customers, as long as there are proper flood defences in place. However, the insurance company warned that the Government shouldn’t take it for granted that this agreement will continue to be renewed in the future. In case of this not being an indefinite agreement, the proper defences should be up and running and the vital investment that is needed to ensure houses and businesses are protected from flood damage should be put into place. They also advised that careful consideration needed to put into where new homes were being built.