Boiler cover plans: are they worth buying?

Millions of homes across the UK will soon be firing up their central heating for the first time in months – and some will find that their boiler decides not to work. Should you pay for an independent callout and bills as they arise, or take out one of the many monthly service plans on offer?

How do the policies work?

Most boiler plans are insurance contracts, meaning customers will have to pay an excess if they claim, and in some cases there is a maximum payout limit.

The cheapest boiler cover that includes a first-year service is the £8 a month (£96 a year) introductory offer at both EDF and HomeServe. But if you claim, you are charged an excess of £95-£100, and in the case of EDF it will only pay for repairs up to a maximum of £500. It’s worth noting such policies will not cover claims that result from sludge buildup, or limescale damage – or a host of other problems that can be the cause of the problem.

As with car insurance or breakdown cover, the trick is to keep switching provider by taking advantage of the introductory offers. The uSwitch comparison website is arguably the best way to find these deals. For comparison, most customers on British Gas’s popular HomeCare Two cover are paying a minimum of £288 a year.

The combi effect

Guardian Money used to tell all readers not to buy these policies, because it was invariably cheaper to just pay the plumber to fix a boiler as required – assuming you had a good plumber. We have had to slightly caveat this advice in recent years because combi boilers are much more complicated and expensive to fix than the old cast-iron ones they replaced. Many combis have turned out to be unreliable and short-lived. Clearly if your one suffers niggling problems, boiler cover with a low excess, unlimited callouts and one that includes parts and labour could be money well spent.

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EDF’s Boiler Protect is the best value at £140 a year – with a zero excess on claims. Cover is available on boilers aged up to 11 years old and in full working order. However, as soon as you claim, you may find future premiums start rising, at which point you may have to rip it out and install a reliable one that comes with a long warranty – ideally seven or even 10 years.

Beware the price hikes

British Gas in particular will take you on at a reasonable price and then start hiking the monthly charge after the first year elapses, or if you make a claim. This week, Money was contacted by a reader who has just been told his British Gas HomeCare Four policy (which includes the whole central heating, electrics and plumbing) was rising to £711 a year. The same cover was offered to new customers online for £456 a year. The worst thing you can do is to sign up to a provider and not monitor the sums being taken by direct debit each month. A year ago we reported how British Gas had ramped up another customer’s premium to an astonishing £895 a year – more than the cost of a new boiler. You have been warned.

Self insurance

Assuming you have a reliable boiler – ideally one that is still in warranty – do you need cover at all? An annual service typically costs £80, and if your boiler is still covered by the manufacturer’s warranty, that’s all you need each year. Just make sure that you comply with the warranty rules and use an approved contractor, if required. Outside warranty, we reckon most people will find that it will be cheaper to pay as they go assuming they have a reliable plumber close at hand – ideally the person who installed it. You will have to be pretty unlucky to run up bills of more than £280 a year, which is what most people pay for these policies.

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