Competition in the home insurance market has become red hot after one of the big players said it would match any quotation a consumer receives from another insurer.

The move comes after another large player continues to give €200-worth of free home insurance a year if you sign up for its motor and health insurance.

Last week, Bank of Ireland threw down the gauntlet to its rivals with what it calls its "Price Match Promise".

The bank is pledging that if a customer can find a cheaper quote elsewhere for home insurance, it will match the price.

In addition to the price promise, Bank of Ireland is offering free accidental damage as a standard feature of its home insurance.

It is also including cover for loss of possessions outside the home of up to €2,500, as a standard part of the contents cover.

And there is no charge for those who opt to pay monthly. Some providers charge interest of up to 24pc for allowing people to pay their premiums in monthly installments.

Discount

The standard "excess" on its policy is €100, the bank said.

The Bank of Ireland challenge follows a move by Quinn-Direct to give customers €200-worth of free home insurance a year for three years if they take out motor and health cover with the company.

It was the first insurer in the market to offer a major discount for those who bundle all their insurance needs with one company, and the move is expected to put pressure on insurance premiums.

One of the most competitive operators in the market, Quinn regularly emerges as among the cheapest providers of motor and home insurance in surveys compiled by the Financial Regulator.

The moves by Quinn and Bank of Ireland are expected to put downward pressure on insurance premiums.

The good news is that home insurance costs have been falling every year since 2002.

But the biggest problem with the home insurance market is the customers themselves.

Consumers deny themselves good value because they allow inertia to take hold and fail to shop around for the best deals.

For proof of this look no further than a survey released last month from the Financial Regulator which found that homeowners can make savings of as much as €370 by getting the best-value home insurance policy.

Sharon Donnery of the Financial Regulator said consumers were denying themselves huge savings by failing to fully check out what is available on the market.

The cost survey from the regulator shows that even with policies that offer the same cover and benefits there are huge variations in premium costs.

Ms Donnery said: "With many people concerned about managing their household budgets, these online home insurance cost comparisons will come as good news.

"They show that it is possible to make savings of almost €370 on your annual home insurance premium, depending on the type of property you own and its location."

A four-bed detached home in County Kilkenny, which would cost €300,000 to rebuild and has €50,000 worth of contents, can be insured for €304 from Quinn Direct. But Allianz will charge €504, a difference of €200.

But a three-bed semi-detached home in Castleknock, Dublin 15, will cost €750 to insure with Axa, but €409 with Royal & Sun Alliance, a difference of €341.

The biggest price difference is for a six-bed guesthouse in the Glenties in Co Donegal, where there is a variation of €366 between the different insurers.

Although consumers were told by the regulator they should seek out the most competitive quote, they were also warned not to just place their business with the company with the cheapest insurance.

Personal finance expert and founder of www.askaboutmoney.com, Brendan Burgess, advised consumers that it is not necessarily a good idea to take out home insurance with the lender who has provided your mortgage.

"Do shop around. And if you get a good deal, do check that it is still a good deal a year later when it is time to renew."

For the first time, the Financial Regulator's home insurance cost survey quotes for owner-occupied apartments.

Ms Donnery said that if you own an apartment, most insurance providers will only quote you for contents insurance.

This is because the management company or the owners of the apartment block will usually arrange the buildings insurance.

The quotes for the apartments featured in the cost comparison are based on contents insurance only and range from approximately €70-€150 per year.

Ms Donnery added: "The online cost comparisons show that contents insurance is quite affordable, but you shouldn't make a choice based on the cheapest quote.

"The cover and benefits included in each policy are different, so ask your insurer or broker what exactly is covered.

"It's also worth spending a bit of time to work out how much your contents are worth."

A full copy of the Financial Regulator's survey is available at www.itsyourmoney.ie.

Doing research can really save you hundreds on home insurance

WHEN John Connolly had to renew his home insurance he decided to thoroughly research what was available in the market to make sure he got the best deal possible.

The Dublin resident has chopped and changed his insurance provider over the past few years to ensure he gets the best value he can.

So when he heard about a discount deal from Bank of Ireland Insurance he initially went back to his original insurer and asked to have the quote matched.

When his original insurer would not match the Bank of Ireland quotation, he snapped up the deal and reckons he has saved €240.

"I did not always shop around for the best deal, but in the past few years I have become more cautious," says the production manager with a graphic design company.

Mr Connolly, who is in his mid-30s, fully expects to go through the same process of checking out what is available in the market when it comes time to renew his insurance.