The new research from Legal & General’s general insurance business asked brokers what impact the current market conditions were having on their household insurance business and their customers.
Brokers mentioned that the ways in which customers were cutting back on valuable household insurance cover to save money included:
Choosing the lowest price option regardless of brand or cover 73%;
Reducing the number of add ons 45%;
Taking the minimum cover 27%;
Taking buildings only not insuring contents 8%.
Phil Kennedy, Business Development Director, for Legal & General’s general insurance business said: “Worryingly these findings support independent consumer research we recently conducted that highlighted that 32% of people would consider shopping around for cheaper household insurance cover to save money. So it would appear that it is now more important than ever for advisers to continue to check that their customers do have adequate household insurance cover in place.
"In today’s economic climate, choosing the lowest price option regardless of brand or cover could be a false economy. By recommending cover from a secure and trusted brand, advisers can give customers confidence that their home is sufficiently protected should the worst happen.
"For example, Legal & General has estimated that the value of the contents of a home could easily be worth £40,000. The value of a customer’s home can soon add up to much more than they think. To help customers appreciate this, advisers may find it helpful to use the online home contents calculator available on our website.
"In the form of a 3D virtual home advisers are able to help customers to ‘tot up’ the value of their possessions, room by room. Hopefully this will persuade them not to reduce their level of cover or worse still cancel the cover they do have in place.
"Household insurance cover is not a luxury purchase. When home contents cover can be provided for as little as £10 to £20 per month, which represents good value, even when household budgets are being stretched.”
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