UK home insurers posted a net combined ratio of 118% in 2023, according to consultancy EY’s latest UK Home Results Analysis report. This was a slight improvement on the 122% achieved the previous year. EY forecast the market would also be in the red for 2024 and return a net combined ratio of 108%.

EY said premiums were on course to rise by 19% this year and forecast they would increase by a further 7% in 2025.

Matthew Wheatley, UK general insurance partner at EY, said: “It was another challenging year for the UK home insurance industry in 2023. Although inflation began to ease last year, claims frequency was high and supply chain issues remained, meaning firms faced another year of significant losses and will have to pass some costs on to the customer.

“We expect firms to get closer to profitability over the course of 2024 and 2025, providing inflation continues to stabilise.”