Deloitte expects the home insurance market to return a net combined ratio of 102.1% in 2026 on the back of the 98% achieved last year. It said increasing competition in the market would drive premiums down by 7% in 2026 to an average of £306.

Deloitte said that although the weather had been relatively benign this winter, the dry summer may yet result in a surge of subsistence claims.

Cherry Chan, partner at Deloitte, said: “For insurers, claims inflation has remained persistent throughout 2025 and is expected to continue into 2026. However, with customers spending more time at home post-pandemic and spotting potential issues earlier, the number of overall claims is down, keeping premium increases off the table.

“The market remains competitive, however, and insurers need to both hold on to existing customers and attract new ones. As a result, premiums are expected to fall in 2026, also leading to a consequent fall in underwriting profitability.”