>> If you’re confused by an aspect of your money or need help with a more specific financial matter why not ask Jo direct and email her at Jo.Thornhill@fmwf.com.

YH writes: I am in the process of buying a new house and need to get buildings insurance in place. There is a large lime tree in the street outside the property. Do I need to declare this on my insurance application and will insurers cover me if the tree causes subsidence? There are some cracks in the pavement around the tree and I am a bit concerned.

Jo Thornhill replies:

When you apply for buildings insurance all insurers will ask if there are any signs of subsidence at the property. If you haven’t already you should get a full structural survey done on the property for your own peace of mind and find out if it has been underpinned due to subsidence.

Scott Oliver, senior underwriter for Direct Line home insurance, says: ‘The structural survey will determine whether the house has already suffered any structural movement caused by the tree. Such movement may not be visible to the naked eye. The survey will help the purchaser to decide whether to proceed in buying the home and will also provide answers to any questions an insurer may have.

‘A solicitor should also be able to find out whether the property has been underpinned in the past or suffered structural damage.’

If there has not been subsidence some insurers will still ask about trees which are in close proximity to the house. You may need to measure the exact distance and it is important to be honest and disclose all information when asked. There is no point withholding information from any insurer as this only renders any insurance policy invalid.

Not all insurers will ask questions about trees. If you are not specifically asked about trees you do not need to disclose the information.

Graeme Trudgill, spokesman at the British Insurance Brokers Association (BIBA), the trade body which represents brokers, says the consumer watchdog the Financial Ombudsman Service would uphold any claim in your favour as the insurer should ask questions that are material to them at the point of sale.

But that said, Trudgill advises that if you have serious concerns about the tree it will probably give peace of mind to disclose the information to the insurer.

An independent broker can help with any concerns and BIBA’s Find a Broker service (0870 950 1790) can locate specialists in this field and those who have experience in the area.

If the tree is in the street outside your house and is on local authority land it is worth finding out if the tree is in a conservation area or under a protection order.

This could cause problems later if the tree is found to be causing movement or undermining the property. Ask how often the council maintains the tree, known as pollarding. For a large lime tree this should probably be done every one to two years to control growth.

>> If you’re confused by an aspect of your money or need help with a more specific financial matter why not ask Jo direct and email her at Jo.Thornhill@fmwf.com.

HM writes: My boyfriend and I are going to California for an extended trip over Easter. I’m planning to take debit and credit cards to use while we are away but I know the fees could be high. Which are the best cards to use when abroad?

Jo Thornhill replies:

Holidays are expensive enough so it makes sense to reduce costs as far as possible by using the right plastic. There is nothing worse than worrying about being stung for high card fees whilst you are away on your dream vacation – or worse arriving home to a nasty bank statement.

On average the charge on a credit card when used abroad is 2.76 per cent, according to research by independent data compiler Defaqto. The vast majority of credit cards charge between 2.75 per cent and 2.99 per cent. It means that if you paid a £75 restaurant bill you would be charged an extra £2.24 on top just for paying with plastic.

But there are a number of cards that don’t charge any fees for overseas spending including the Halifax Clarity card, Post Office credit card, Saga Platinum card (only for the over-50s) and Metro Bank credit card. The Sainsbury’s Gold credit card also charges no fee but this card has a £5 monthly charge. For this cardholders get annual family worldwide travel insurance.

Be aware also that drawing out money from cash machines overseas will also incur charges – in the same way as it does if you withdraw cash from an ATM with a credit card in the UK. The only exceptions are Halifax Clarity, Metro and Sainsbury’s, which impose no fee on cash withdrawals anywhere in the world.

There are also a range of debit cards that do not impose fees for use overseas, but getting hold of one of these will mean switching your current account, which you may not want to do. Switching to a new current account will probably take about six weeks so factor this in if you want to go down this route. The best cards are with Metro Bank, the Santander Zero current account, Norwich and Peterborough Gold account and Cumberland Building Society Plus account.

David Black, banking expert at Defaqto, advises holidaymakers take a range of currency options on holiday for convenience and to spread risk: ‘It’s advisable to take a mix of cash currency, which you can exchange at home before you go, and then a credit card which does not impose foreign exchange charges – and perhaps a prepay card, which can be loaded with currency in advance. Ideally keep the cash and cards separate in case of theft of a handbag, for example.’

Prepay cards are the modern-day equivalent to travellers cheques. Money is loaded on to the card in advance in the currency you need – for example euros or US dollars. This can be done online or over the phone. You can then use the card to spend in shops and restaurants abroad or to withdraw currency from ATMs.

Prepay cards have the added security that if they are stolen the thief cannot spend more than is on the card – there is no line of credit as with a credit card. But the usage fees can be high so check the small print before you sign up. The Fair FX, Post Office, Travelex and Caxton FX cards are among the best.

By way of example the Post Office travel money card is free to open but has a two euro charge on cash withdrawals in Europe, $2.50 in the US and £1.50 in the UK. There is no fee on purchases.

Are you seeking ways to boost your battered income? The answer could be closer to home than you think. There is money to be made by taking in a lodger, or by renting out space on the driveway or in the loft.

One in ten homeowners earns extra cash by letting a room to a lodger, according to Santander bank. These ‘rent-a-room’ entrepreneurs are raking in a total of £3.9billion a year – an average of £182 a month.

Homeowners can charge up to £4,250 a year without incurring tax on the rent. You can charge more, but will have to declare all the income on a self-assessment tax form each year. The benefit of paying the tax is that you can claim back tax relief for wear and tear and maintenance of the lodger’s room.

There are many websites – such as spareroom.com and mondaytofriday.com – that enable you to advertise your spare room. Or you could let the room short term or nightly to tourists and earn up to £50 a night. Crashpadder.com lists spare accommodation offered in a similar way to a hotel room.

Spare loft, shed and garage space can also bring in money. Storemates.co.uk enables owners to advertise any spare storage space. The idea is that for a small fee – much lower than renting commercially – neighbours can help each other out.

Susie Diamond, 38, a structural engineer from Cricklewood, north-west London, listed her loft space on the site two weeks ago and has already been bombarded with requests from neighbours.

‘We have a large attic that we would eventually like to convert into a bedroom,’ says Susie, who lives with husband Neil, a teaching assistant, and their two children, Hugh, 7, and Helen, 4. ‘We can’t afford to do that at present so when I heard about storemates it seemed like a hasslefree way to earn a bit of extra cash.’

Storage providers pay nothing to register with Storemates but once a space is rented they must pay an ‘introduction fee’ equivalent to two weeks’ rent. Susie has advertised her attic space for £10 a week, but says this is negotiable. ‘Even if we made only £20 or £30 a month, we can put it towards treats,’ she says. ‘And it’s nice to feel we are getting to know local people and helping them out.

‘Of course, I would always want to know what was being stored and I will make people sign a contract so I have no liability for their items in the event of fire or flood damage.’

Websites such as parkatmyhouse.com, parkonmydrive.com and parklet.co.uk match up drivers who need a parking space, perhaps for their weekly commute, and households that can help. The website takes a cut from the deal, typically about 15 per cent.

You must speak to your mortgage lender before letting a room as some impose restrictions. Some landlords may not allow you to sub-let a rented property.

It is important to check these details as you could render your mortgage or tenancy agreement invalid. There is more information on the Rent a Room scheme at direct.gov.uk, click here.

Renting out a room, storage space or a parking space will also have implications for your home cover so speak to your insurer. It will usually expect you to have a contract in place to remove any liability for theft or damage, for example to a vehicle while it is on your property or goods in your attic that are not yours.

If you live alone and then take in a lodger, remember you will lose your single person’s council tax discount, currently 25 per cent.

Enough was enough for Julie Parnell when she added up the cost of her 40 cigarettes-a-day habit. Keen to start her own business and get on the property ladder, she went cold turkey.

‘I was spending around £13 a day on cigarettes,’ says Julie. ‘When I realised that was almost £400 a month, it was the wake-up call I needed.’

Julie, 41, had saved up a small deposit towards a house but did not earn enough to pay a mortgage. She realised that if she gave up smoking, she could afford it.

‘I’d dreamed of owning my own place but never thought I would have the means,’ says Julie, who has a grown-up daughter. ‘But after giving up smoking I had so much more disposable income. Getting the mortgage was much easier than I thought and my monthly repayments are now £350 – less than I spent on cigarettes.’

It meant she could buy a Fifties three-bedroom semi in Wellingborough, Northamptonshire.

Julie has also given up her job running a sheltered housing complex to start up her own business selling ‘shabby chic’ household items at markets and fairs. Provided she gets to grips with all the red tape, Shabby Chic Barn will be launched within weeks.

‘Life has changed so much. I feel healthier and happier because I’m pursuing a business dream,’ says Julie. ‘I would not have had the confidence to do this if I hadn’t been in my own home.’

The benefits don’t stop there for Julie. Like other non-smokers, she will eventually be eligible for cheaper life and critical illness cover.

Matt Morris at specialist broker LifeSearch says: ‘Smokers are more likely to have to claim for serious illness or death and that is reflected in higher premiums.’

About ten million people in Britain smoke, according to the charity Cancer Research UK, and they have to pay more for life insurance.

A 40-year-old man needing £100,000 of life and critical illness cover for 25 years would pay £94 a month if he was a smoker. A non-smoker could buy the same cover for only £53.

Reformed smokers have to be clean of all nicotine products, including patches, for at least 12 months before they can apply for cover as a nonsmoker.

Some insurers can request a cotinine test, which checks levels of nicotine in the body.

Julie has been using electronic cigarettes from ecigarettedirect.co.uk to help her beat her addiction. These battery-operated cigarettes use cartridges of liquid nicotine, so although there is no tar or tobacco, for the time being Julie is still considered a smoker by the insurance industry.

Morris at LifeSearch says it is important not to cancel existing life or critical illness policies until a new one is in place.

‘After you’ve been nicotine-free for 12 months you can see whether your existing premium will be reduced by re-broking your policy,’ he says.

‘The cost saving will depend on factors such as the age you were when you took out the existing policy and whether you have had any significant illnesses or conditions in the meantime, which could push up premiums, despite now being a non-smoker.

‘If you have suffered major health problems in the intervening years, it is possible that a new policy could be more expensive after underwriting.’

When it pays to be unhealthy

The one financial transaction when it pays to be a smoker is buying a pension annuity – an income for life.

This is because your life expectancy is lower. Yet fewer than a third of those who are eligible for an enhanced or impaired life annuity get one.

‘Enhanced annuities can considerably boost annual income,’ says Bob Bullivant of Annuity Direct, based in Ryde, Isle of Wight. ‘Looking across the whole annuity market is even more important if you have a health or lifestyle condition, such as smoking or high blood pressure.’

For a 65-year-old man with a £100,000 pension pot buying a level annuity guaranteed for ten years, a non-smoker would get an annual income of £5,888.

A smoker with high blood pressure and high cholesterol would get £7,441, according to Annuity Direct.

The definition of a smoker in these cases is somebody who smokes at least 20 a day. A smaller enhancement is available for lighter smokers, down to ten a day.

Those who smoke less are unlikely to be offered any enhancement. Smokers will usually be required to complete a full medical questionnaire.

>> If you’re confused by an aspect of your money or need help with a more specific financial matter why not ask Jo direct and email her at Jo.Thornhill@fmwf.com.

By Jo Thornhill

A spate of price cuts in the energy market in recent weeks has led many people to wonder whether it is better to opt for a fixed rate tariff or take a gamble on standard rates. Here’s a look at the options…

The Big Six energy companies have all announced price cuts to either gas or electricity (none cut both) in the past few weeks. Though the cuts were small, typically five per cent, they are welcome at a time when most households are feeling the pinch and winter bills are high.

Energy experts are now predicting further price falls could be on the cards before summer. This is because prices have been falling in the wholesale markets. Gas prices are down 20 per cent since September last year.

Consumers who opt to fix their bills now won’t gain from further cuts. But as Mark Todd at the energy comparison website energyhelpline.com points out many fixed-rate tariffs are actually lower than standard bills.

‘Consumers who have never switched before and are on standard rates, particularly if they are paying on receipt of the bill could make significant savings  - even up to £200 in the first year – by taking a best-buy fixed rate deal. They’ll also have the peace of mind of a fixed rate.’

With the best fixed rate tariffs consumers have to agree to pay monthly by direct debit and the account is usually managed online – no paper bills are sent in the post.

The cheapest fixed rate tariff currently on offer is from OVO Energy. Its ‘New Energy Fixed’ deal works out at £1,059 for a typical household for one year. This is based on the industry standard measure of 16,500 kWh for gas and 3,300 kWh for electricity, paying monthly by direct debit.

By way of comparison the cheapest standard dual fuel rates are currently with EDF Energy at £1,203 – still £140 more than OVO’s fixed rate. The industry average standard dual fuel rate is £1,259.

Those who prefer to take a gamble on prices coming down further could save even more.

First Utility’s iSave V9 dual fuel deal would be £1,030 a year for the same average household. This is the cheapest energy deal currently on offer. It is not a fixed rate tariff. Customers must pay monthly by direct debit and bills are online.

People in existing fixed rate tariffs are being advised to stay put until their deal expires, despite recent price falls.

Joe Malinowski at TheEnergyShop.com says: ‘Most fixed rate deals taken in recent years are lower than standard rates so there is no benefit in switching. Fixed tariffs usually have exit fees during the fixed rate term, typically between £40 and £100 so this also has to be factored in.’

Some British Gas and Eon fixed price tariffs have started to look a bit expensive. Consumers with concerns should speak to a comparison service and get advice about the pros and cons of switching and how much they could save.

Switching energy supplier is easy.

Use a comparison website such as the one offered on our sister website thisismoney.co.uk to identify the best deal in your area and for your particular energy usage. You can then apply through the website or contact the new provider direct to apply.

The new provider will contact your old supplier and organise the switch. You do not need to do anything except take meter readings on the day of the switch. The whole process should not take more than four weeks.

It is important to note that the tariffs listed are correct as of 23 January 2012 but deals change on a regular basis.

It is the biggest fall since September 2010 and means that average annuity rates are down by almost one tenth since June 2009.

Turmoil in the eurozone has played a part by causing the returns earned on British Government bonds, known as gilts – on which annuities depend – to fall sharply.

A man aged 65 with a £50,000 pension pot would have been able to purchase a conventional lifetime annual level income of £3,224 in 2009. But today that has dropped to only £2,902.

Enhanced annuities, which pay an increased rate based on the reduced life expectancy of the annuitant due to medical conditions, have slumped by an average of 2.45 per cent since last September.

A £50,000 pension fund would now buy an enhanced level lifetime annual annuity income of £3,583 for a 65-year-old man compared with £3,913 in 2009.

Andrew Tully, technical director at MGM Advantage, the annuity specialist that conducted the research, says: ‘More than ever people should not accept the annuity deal they are offered by their pension provider.

‘Shop around and get specialist advice to ensure you get the best possible deal.’

Almost a third of households will see no drop in annual fuel bills despite the round of price cuts by the ‘Big Six’ suppliers.

This is because they are either trapped in fixed-price deals or get their electricity and gas from different suppliers where prices did not fall.

For example, British Gas has cut its electricity prices by five per cent but left gas prices unchanged. It supplies 10.5million households with gas but five million with electricity.

‘No big provider has cut both gas and electricity prices,’ says Mark Todd at energyhelpline.com. ‘Millions of consumers feel short-changed at a time when winter bills are adding to the mounting cost of living.’

About 2.5 million households are in fixed-price dual-fuel deals lasting between one and three years. They won’t benefit from cuts. The exit penalty is between £40 and £100, depending on tariff and supplier.

But Joe Malinowski at comparison site theenergyshop.com says: ‘Fixed-price deals have been competitive and most customers are paying less than standard tariffs, even after recent cuts. In most cases, you are better off staying put.’

Experts urge households to switch if they are on standard tariffs with no exit penalty. For example, someone in North Wales or Liverpool with traditional regional suppliers British Gas and ScottishPower, which bought Manweb, and who has never switched could slash their dual-fuel bill by £330 in the first year by moving to the lowest standard deal from First Utility.

>> Scroll down to read “Expert help can avoid a filing headache”

Brutal new penalties for late payment of tax – coupled with strike action by Revenue call centre staff – are threatening millions of individuals and businesses just as one of the tax year’s most important deadlines draws near. Critics say the harsh new regime, which could rake in hundreds of millions of pounds, is simply a means for the Government to raise more cash.

‘This is especially galling, given Revenue & Customs’ own record of outrageous tardiness, mismanagement of files and propensity to tax millions of people the wrong amount,’ says one irate accountant.

Midnight on January 31 – a week on Tuesday – is the deadline for taxpayers to file their tax return electronically and pay anything owed for the 2010-11 tax year. About nine million people are in the self-assessment system. As of last Monday, the Revenue confirmed that more than two million forms were outstanding.

About ten per cent of taxpayers – one million – typically miss the January deadline. Fines of up to £400 million were collected by the Revenue last year, including interest on unpaid tax. More than 572,000 returns were filed online on January 31 last year and the Revenue is expecting a similar rush this year.

Those who miss the date will get an automatic £100 fine. But this year the flat fee will be applied on all late filers whether they owe tax or not – and even in cases where someone is due a rebate. In the past, taxpayers who did not owe any tax would not be fined. Fees for very late filing and payment have also been significantly increased. After three months, if a return has not been made and tax not paid, there is a £10 a day fine, up to 90 days or £900. After six months, £300 or five per cent of the outstanding tax, whichever is higher, will be charged.

After 12 months another £300, or five per cent penalty, will be levied again. In some cases, after one year, the taxpayer could be fined 100 per cent of the amount owed.

Previously, the penalties for late payers were much lower. Interest on any unpaid tax was applied at five per cent and added to the bill at the end of February and this would happen again if the tax had still not been paid by the end of July.

Chas Roy-Chowdhury, head of tax at the Association of Chartered Certified Accountants, says the new penalty regime is unfair. ‘Many ordinary taxpayers who simply left it late or who experience problems for whatever reason could be fined,’ he warns.

And Frank Nash, a senior tax partner at London chartered accountant Blick Rothenberg, thinks the Government is simply looking to cash in. ‘The Revenue is going to be a lot tougher this year as the Government tries to balance its books,’ he says. ‘I do not expect it to show any leniency to taxpayers.’

To compound the problem, strike action last Monday by 20,000 Revenue call centre staff over the possible outsourcing of the service could also affect those who are trying to file ahead of this month’s deadline, particularly if they have queries. A further strike is planned for deadline day, a week on Tuesday.

A Revenue spokesman says: ‘Taxpayers have had nine months to get their forms done. The reason for the bigger fines is to discourage those who try to avoid filing the form, or paying the tax. If people have genuine issues around payment, we urge them to file their tax return on time and speak to us as soon as possible about organising a payment schedule.’

Anne Marie Taylor, 41, from West Wycombe, Buckinghamshire, has used taxdoctor.co.uk for the past two years.

Anne Marie, who runs a business providing inventories for landlords and letting agents, says she has paid thousands of pounds to accountants in the past, but now Taxdoctor charges just over £100 each year.

‘I think there is a tendency for many people to put their head in the sand when it comes to their self-assessment form,’ says Anne Marie, who is married to Dom, 37, a medically retired police officer and has three children. ‘With Taxdoctor, I know my tax affairs are in order and filed to the Revenue well in advance of the deadline.’

>> The Revenue has a helpline (0845 900 0444) for self-assessment taxpayers who need extra pages for their return or general advice.

Expert help can avoid a filing headache

SEVEN million taxpayers will file online this year out of the total nine million taxpayers in the self-assessment system.

If you haven’t registered for online filing, do so by Monday at the latest. The Revenue will need to post you your log-in details, which can take up to one week to arrive. The last date to guarantee timely arrival was yesterday – so the clock is already ticking.

Set aside some time to complete your online self-assessment form and ensure that you have all the necessary paperwork before you start, such as your P60 form if you are an employee, which gives details of last year’s earnings and tax paid. You will need information about the interest or dividends paid on savings from your bank or investment manager.

If you have concerns about your tax return, you are doing it for the first time or you have complex tax issues, such as capital gains to calculate, it may be advisable to seek independent professional advice from an accountant or tax specialist. This does not have to be expensive. Services such as taxdoctor.co.uk (see report above) can complete and submit forms online from about £99 plus VAT. But you will need to act swiftly.

Taxdoctor can still submit your forms online, even if you don’t have an activation code. Gary Heynes, tax partner at accountant and tax adviser Baker Tilly in central London, says: ‘Make sure you claim all the reliefs to which you are entitled, such as pension contributions and Gift Aid on charity donations.’

>> If you’re confused by an aspect of your money or need help with a more specific financial matter why not ask Jo direct and email her at Jo.Thornhill@fmwf.com. 

JP writes: I have worked for myself for the past six years but now realise as I’m approaching 40 that I have neglected my pension arrangements. I’m starting to worry about this but don’t know where to start. I’ve read that the fees and charges on traditional pension plans can be high. Am I better off investing in an equity Isa?

Jo Thornhill replies:

IT is good you are keen to address this issue. We keep being told that we are all living longer and the State will provide less in the future, so the onus increasingly is on individuals to save for their old age. The sooner you can do something about your own savings the better.

Pensions

You can contribute an unlimited amount of your earnings up to £50,000 a year into a personal pension plan and receive tax relief on this at your highest rate. For a basic rate taxpayer this means an £80 contribution is grossed up to £100.

This is because although tax relief is at 20 per cent, this is on the gross contribution of £100. The effective rate is therefore 25 per cent based on the £80 actually paid. Higher rate taxpayers must reclaim the tax break via their self-assessment tax return, but if you are self-employed you already do this each year.

Pension saving makes a lot of sense in terms of tax relief but the big downside is that the cash is locked up until retirement. No early access is permitted.

The earliest age you could access personal pension benefits under current legislation is 55. On top of this there may be high charges on the underlying investment funds in the pension.

If you want to go down this route it is advisable to seek independent financial advice about which types of investment will suit your needs.

The website unbiased.co.uk can help you find an adviser in your area. An adviser can help you find the pension plan with the right mix of assets and ideally, one with the lowest annual charges.

Jane Heyman, a chartered financial planner with adviser McCarthy Taylor, points out that Stakeholder pensions tend to have lower charges, making them a cheaper form of pension saving.

Stakeholder was a Government initiative launched about ten years ago to tackle the pension savings gap. Plan providers cannot charge more than 1.5 per cent in annual charges in the first ten years and not more than one per cent thereafter. Savings can start from as little as £20 a month.

‘The drawback is Stakeholder plans can be restrictive in terms of investment choice and the income options available in retirement,’ says Heyman. ‘Getting professional advice is a good idea.’

Isas

Alternatively you may prefer the flexibility of a tax-free ISA investment account. The maximum you can contribute to an equity Isa, which invests in a mix of stocks and shares, is £10,680 per tax year. The annual allowance will rise to £11,280 in April.

Although there is no initial tax relief on contributions into an Isa (as with a pension) the income taken from an Isa on retirement will be free of tax. In contrast the income from a pension is taxable in retirement.

Heyman says the tax benefits for pensions and Isas are broadly similar for basic rate taxpayers so it boils down to how you feel about having the cash locked up. A pension removes the temptation to dip in to savings.

‘It depends on your attitude and ability to commit funds until retirement age or whether you prefer to keep options open via an Isa, which permits access to funds,’ says Heyman. ‘This could be necessary in an emergency, for example.’

Heyman adds that ideally a combination of both a pension and Isa would give an effective result, particularly for higher rate taxpayers, where they can utilise as much higher rate tax relief as possible within a pension.

Diversifying saving is a good idea because you spread risk and stick to the old adage of not having your eggs all in one basket.

For more information on stakeholder plans and other pension options including comparison tables of providers go to moneyadviceservice.org.uk.

>> If you’re confused by an aspect of your money or need help with a more specific financial matter why not ask Jo direct and email her at Jo.Thornhill@fmwf.com. 

VH writes:  I am considered a high risk profession for car insurance and the costs are high. Are there are any companies that specialise in looking in more detail at those who in so-called ‘high risk’ jobs and can offer better premiums?

 Jo Thornhill replies:

What someone does for a living is a big factor when insurers are calculating risk – and the premium you pay. Typical high risks include casino and nightclub workers, those in the Armed Forces, unemployed people and those in the media and entertainment industry, including journalists.

The risk is higher because of the potential for personal injury claims and the types of environment in which the vehicle may be used. Some insurers won’t even cover particular professions.

Other occupations, such as teachers and nurses, can often qualify for discounts as they are considered lower risk.

By way of example comprehensive cover on a Ford Focus 1.6, would cost about £390 for an insurance clerk, but in contrast a journalist could pay £545 – almost 40 per cent more.

Graeme Trudgill, head of corporate affairs at the British Insurance Brokers’ Association, says: ‘There is no fixed percentage increase or discount by profession – different insurers have different attitudes to the risk levels of different professions. But for some higher risk occupations the increase compared to a mainstream job could be from five per cent and upwards.’

The premium quote you are offered will vary depending on which insurers you approach. So the best advice is to search the market as widely as possible – ideally using an independent broker. Experts say you need around seven different quotes before you can find the best value.

Specialist broker Adrian Flux, based in King’s Lynn, Norfolk, says the best deals are usually found only by phoning around: ‘Underwriters will usually want to ask more in-depth questions to get the exact nature of the occupation and assess the risk more accurately. But this can help bring premiums down,’ says a spokesman.

To find an insurance broker who understands this market visit biba.org.uk or call the helpline on 0870 950 1790. If it is a company you are dealing with for the first time always check the Financial Services Authority website to confirm a company is regulated at fsa.gov.uk