Multi-year home insurance allows policyholders to avail of the same insurance cover as a standard yearly policy, but with the guarantee that your premium won’t change for up to three years, even if you make a claim.
At bonkers.ie we always say switching every year saves. However, sometimes signing up to a contract longer than the standard 12 months has its merits.
That’s where multi-year home insurance comes in.
Whether you’re looking to take out cover for the first time or have a policy that’s due for renewal and want to suss out a cheaper alternative, a multi-year home insurance policy can provide you with certainty and financial security.
And what’s more, at bonkers.ie we now have our own home insurance service where customers can purchase multi-year policies online from the comfort of their own couch.
However, before we delve into why a multi-year home insurance policy might be right for you, here’s a bit more detail as to what exactly it is.
What is multi-year home insurance?
With multi-year home insurance, you simply choose how long you want your policy to last – either two or three years – and we’ll give you a guaranteed price for that length of time.
Taking out a multi-year home insurance policy is favoured by many for the certainty it provides in terms of budgeting, as well as the guarantee that your premium won’t increase for the agreed term of your policy.
Advantages to a multi-year home insurance policy
If you’re looking to get cover in place, there are a number of advantages to choosing a multi-year home insurance policy.
Let’s take a look.
1. Guaranteed price over several years
Multi-year insurance policies offer a fixed, guaranteed price for your home insurance for up to three years so you don't need to worry about rising costs.
2. Effective financial planning
Knowing how much your home insurance will cost for several years will allow you to budget accordingly and provide financial certainty.
3. Flexible payment options
Another boon about multi-year cover is that, in most cases, you don’t have to pay the whole premium up front. Most providers offer flexible payment plans so you can spread your payments out over the duration of your policy.
Most insurance providers will require a deposit though, which is pretty standard, and usually only about 5% of the total premium. So a two-year policy priced at €800 would require a downpayment of €40, for example. The rest of your premium will then be collected in instalments with a low APR. It’s very straightforward.
However if you prefer you can pay upfront for your multi-year policy in one go.
4. Additional benefits
As with a standard home insurance policy, when you take out a multi-year policy you can avail of additional benefits. This can vary from additional cover for personal possessions, right through to cover for charges for emergency services.
For example, Zurich provides cover up to a value of €2,000 for personal possessions taken outside the home, as well as cover up to €700 for replacing door locks, and a 24-hour emergency helpline.
5. Low interest rate environment
As most are aware we’re in a very poor environment for savers right now with interest rates for savings accounts well below 1%. So, instead of putting your money into a low-yield savings account, a better use of your money could be covering your home insurance needs for the coming years.
6. No cost to claims
Taking out a multi-year policy has the added benefit that the cost of your premium won’t immediately rise in the event of you making a claim.
After you've made a claim you would normally be hit with an increase in the cost of your premium when you go to renew the next year. But with a multi-year policy your premium won't change for the full term of your policy. However when you go to renew in either two or three years' time you may be faced with an increase in your premium.
7. Protected no matter what
If your circumstances change during the term of your policy and you need to cancel you’ll be able to do so without being subject to a cancellation fee, provided it’s been more than one year and no claim was made. In other words, if you cancel mid-term you would only pay for the period of cover and anything beyond that would be refunded.
Be aware, however, that this may vary with insurance providers. As well as that, there may be restrictions on eligibility for multi-year cover. For example, some insurers will only offer multi-year policies for owner-occupied homes that are claims-free for a number of years.
Protect yourself against inflation
The current rate of inflation in Ireland is 6.7%. This means that prices are rising at their fastest pace in over 20 years. What's more, the rate of inflation is expected to rise even higher before the end of the year, according to the Economic and Social Research Institute (ESRI).
With a multi-year home insurance policy there is a guarantee that your premium won't change for the duration of your policy, no matter how high inflation might go. In this way it's possible to protect yourself against rising premiums and potentially save on the cost of your policy at the same time.
There's no way of knowing what the price of home insurance could be in 12 or 24 months' time so locking in a set premium over a number of years can help to protect against inflation and provide certainty in a time of rising prices.
Considerations before taking out a multi-year policy
Of course, taking out a multi-year insurance policy won’t suit everyone.
Perhaps the most important thing you should consider is how you manage your finances and whether signing up to a two or three-year policy is something you know you’ll be able to commit to.
A policy that lasts for longer than the standard term of 12 months might not suit those who prefer to review and compare policies each year.
Home insurance service on bonkers.ie
At bonkers.ie we were delighted to recently launch our very own home insurance service.
Homeowners around Ireland can now save money on their insurance costs in minutes by applying with us online.
To get an instant quote all you need to do is fill out your home insurance details and cover requirements using our online application form.
Once you’re happy with the details of your new policy and complete your application in a timely manner, you can have your policy in place in minutes, subject to meeting our acceptance criteria and terms and conditions.
Helpful guides for homeowners
Before you start saving on your home insurance, check out our helpful guide first for 10 ways to reduce your home insurance costs.
We also have plenty of useful guides for saving on your other insurance costs:
- See here for simple ways to reduce your costs across all types of insurance.
- Taking out car insurance? Here are 12 things to consider beforehand.
- Here we answer 15 common life insurance questions.
- Last but not least, here are some of the important things to consider when taking out mortgage protection insurance.
Get in touch with us
Do you have any questions about multi-year home insurance? If so, we’d love to hear from you!