Buildings insurance premiums increase

The average buildings insurance premium has increased by 50p hitting a record high of £218.53 a year, as the cost of cover rose for the eighth consecutive quarter.

The AA said the 8% increase in the price of buildings insurance during the past year was the biggest jump it had seen since it began collecting the data in 1994.

Also the downward trend in the cost of home contents insurance over recent months has now reversed with premiums for the cover jumping by 2.7% during the quarter to average £126.34, according to the AA.

However, with home insurance premiums only increasing by a few pounds since the index began 1994, the AA said they still offered good value for money.

Simon Douglas, director of AA insurance, said the premium for home contents insurance has increased by almost 1% every month over the past quarter, which is an unusually steep rise.

He said the high number of fraudulent claims made last year was part of the reason for the increase.

"Fraud thrives during times of recession and the inevitable result is an increase in premiums," he added.

Burglary Risk in UK - Lowest In Preston

People living in Preston may make a saving on their home insurance after a survey revealed that they are the least likely to be burgled residents in the country.

While those with London addresses are the most at risk, the Lancashire city is rated as the safest in the UK, according to research carried out by home insurance company Endsleigh.

The firm used household theft claims made by its policy-holders over a four-year period to rank areas.

Results showed that Preston residents were around 67% less likely to suffer a break-in than the national average. Norwich and Ipswich came in second and third places.

London homes were found to be 55% more likely to be burgled than the national average, with Nottingham, Bristol and Cambridge properties also presenting a high risk of being broken into.

Endsleigh spokeswoman Rhiannon Harris warned that every householder in the country should be aware of the possibility of burglary. She said: "It's crucial that, as well as helping the success of neighbourhood safety schemes where they can, people across the country remain vigilant when it comes to home security."

Pros and Cons of Getting a Lodger

Tips on finding out whether a landlord’s life is right for you. With everyone currently feeling the pinch, many homeowners are clearing their spare room and advertising things like a house share in London to help pay the mortgage. But how do you know if becoming a landlord’s right for you? Confused.com looks at the pros and cons of getting a lodger.

The Pros

Money, money, money
The main benefit for anyone looking to rent out a spare room is money. It’ll help to cover the cost of your mortgage and you’ll have an extra person to split those household utility bills with – you can finally afford to put the heating on for that little bit longer!

Another tip to increase savings and reduce outgoings is to see if you find a cheaper mortgage.

Earn more with the Rent-a-Room scheme
The Government has a rent-a-room scheme, which means if you get a lodger you won’t be taxed on up to £4,250 of the rent income.

Find a friend
If your social life’s a little on the quiet side or you want someone to discuss last night’s EastEnders with, advertise for a lodger. Not only will it help you out financially, but you could make a new friend.

Part-time lodgers
If a full-time lodger is too big a first step, start off with a part-time one instead. Some prospective lodgers are looking for weekday lettings only and then returning to their own home on the weekend. You may earn less money but at least you’ll have the place to yourself on weekends.

Short-term lodgers
Another option is to find a short-term tenant. Students or contractors are often looking for temporary accommodation, so tapping into this market means you won’t have too long to wait if it turns out a landlord’s life isn’t for you.

An extra pair of hands
If you’re great at cooking but find it hard to plug in that vacuum cleaner, then getting a lodger could prove a great addition. An extra pair of hands to share the duties means you’ll have more time to do the things you really enjoy.

Safety
If you live alone you may feel safer with someone else in the house. Also, it means there’ll be someone home to deter burglars when you head off on holiday.

The Cons

Adapting your lifestyle
OK, so extra money, company and security may be welcome additions, but there are cons to taking in a lodger – primarily to do with the impact it will have on your lifestyle.

Freedom
You possibly won’t be able to cook when you want, bathe or shower when it suits, watch your favourite telly show if the lodger’s already watching something in the communal living space, and you’ll definitely need to rethink whether it’s ok to continue walking around the place in your underpants.

You don’t get on
This is the biggest potential problem with taking on a lodger, so try and get a feel for prospective housemates first to see if you’re compatible. Ask what their hobbies are and find out what you have in common. If they like playing the drums or if they’re a chain smoker and you’ve just quit, you might prefer to keep looking.

Even if you go through a thorough interview process, you still won’t really know what the person will be like to live with. One way to safeguard against ending up with a nightmare tenant is to offer a short, probationary contract to being with. This could be good for both of you, after all, they may not find you easy to live with!

You or your landlord has a partner
This may not prove to be a problem at all, but if you’ve rented a room to just one person but they have a partner who’s around all the time, it’ll be like living with two extra people. There’ll be more washing up, a longer queue for the bathroom and they’ll be using more than their share of household utilities. Make sure you ask about this before accepting a lodger.

Likewise, if you live with your partner and/or have a family living in the house, think of the impact a lodger will have on these relationships.

Finally…
Having a lodger may affect your home insurance. It’s possible to get a discount if the amount of hours someone is in the house increases, or premiums may go up if you decide to include the tenant’s valuables under your cover. Alternatively, you may want to leave it up to them to sort out their own contents insurance.

If you’re receiving benefits from the government, the additional income from a lodger could affect the money you receive. While you’d need to confirm this with the specific body, the general rule is that if you’re receiving means tested benefits then this additional income would affect you, whereas if you’re on contribution-based benefits, you may not lose out.