Does Your Postcode Impact Your Insurance Premium?
One of the name of
factors in determining the price of
uk property insurance for customers in the UK
is the postcode in which the property is located. It is so easy for underwriters
and insurance companies to analyse risk factors are postcode due to the
overwhelming use of computer technology and market databases. Data can be sorted
into various risks such as burglary, storm damage,
floods
and subsistence. It is quite normal now for some insurers to exclude prospective
customers from even applying for insurance products based on their post code
because statistical analysis are shown but these postcodes will provide a bad
risk and hence lose the company money.
Flooding Postcodes
- the recent floods in the United Kingdom have clearly shown postcodes where
flood plains exist and the enormous damage that has reinforced underwriters
attitude towards risk in specific high risk areas. If you live on the edge of
the postcode area you may be paying for more than a neighbour that lives in a
different postcode just across the road. This may seem somewhat unfair to the
lay person, however insurers have to use some form of numerical analysis and
dividing lines to mitigate risk. In the UK, there are over two million
properties that are situated on the flood plain. Parts of the summer of 2007
caused over two billion pounds worth of damage largely in those areas. It is
probable that in the future these areas will face higher insurance premiums.
Even though specific property postcodes may not be targeted with price rises,
the national scale of the flooding is likely to push up prices generally for
everybody in future.
Burglary Postcodes
- a recent study by Endsleigh showed that if you live in Nottingham you're more
likely to be burgled than other areas in rest of the UK. The least likely area
to be burgled is in Guildford in Surrey. This example came form a study that
analysed insurance claims from customers during the last four years. The summary
results are as follows:-
|
WHERE YOU'RE MOST AT RISK |
|
WHERE IS THE SAFEST
|
|
1 - Nottingham
2 - Leeds
3 - Hull
4 - London
5 - Oxford
6 - Bristol
7 - Reading
8 - Manchester
9 - Sheffield
10 - Cambridge |
|
1 - Guildford
2 - Swindon
3 - Dundee
4 - Bath
5 - Coventry
6 - Brighton
7 - Aberdeen
8 - Cheltenham
9 - Edinburgh
10 - Belfast |
This sort of study helps
to re-enforce post coding methodology towards setting building insurance
premiums.
Saving Money - so
what can you do if you live in a postcode that means you are paying higher
premiums than other people in different postcodes of the UK? Firstly, shop
around; it seems obvious that most people are apathetic and simply renew their
existing
building insurance uk policy without bothering
to check whether the price they are receiving is competitive or not. Secondly,
install good quality locks on your windows and doors of your property as well as
a good burglar alarm and smoke alarms. This will help to reduce your premium.
You could also join your Local neighbourhood watch group.
