Worryingly, the research also revealed that 16% of people have never even thought about taking out a home contents insurance policy, and a further 18% do not think the risk warrants the expense. This is despite recent crime statistics indicating a 4% rise in the number of domestic burglaries.
This issue of contents cover corner-cutting is particularly acute when examining the rental market.
Renters render themselves particularly vulnerable with 30% failing to secure cover for their possessions, compared with just 6% of owner-occupiers. This is despite the fact that almost three quarters (73%) of tenants admit they wouldn’t be able to afford to replace their valuables if they were stolen or damaged. Misconceptions are also rife among renters with 11% assuming they are automatically covered by their landlord’s policy.
These statistics are particularly concerning with the UK’s rapid rental surge. Housing tenure statistics indicate a substantial increase in the size of the private rented sector, from 2.7 million in 2007 to nearly 3.0 million in 2008, with private rentals now accounting for 13.9% of households, the biggest share since the 1970s.
This increase is mainly due to affordability issues as first-time buyers struggle to get on the housing ladder and property owners who are forced to rent properties they cannot sell.
The student age bracket of 18-24 year olds also reveal themselves to be among the worst offenders with 39% failing to secure their own cover for possessions – a worrying figure considering that students own more expensive consumer goods per head than the rest of the population. Some of these students may be covered by their parent’s home contents insurance but this may not always be the case and depends on individual policy terms and conditions.
In addition, young people are around three times more likely to be victims of burglary than people in other age groups, making them all the more vulnerable if they are underinsured.
Mark Monteiro, Insurance Expert at uSwitch.com said: "We are fast becoming a nation of contents cover scrappers, as renters and homeowners try to cut back and save money during the current recession.
"The fact that nearly half of homeowners and renters alike don’t feel they can afford home contents insurance at the moment is a worrying sign of the times. Yet, with recent crime figures revealing domestic burglaries to be on the up, as has proven the historic norm in a recessionary climate, consumers are running the gauntlet by putting themselves increasingly at risk simply to make a short-term saving.
"It is crucial to remember that the long-term financial consequences of being a victim of burglary or suffering damage to your property and possessions will be far more devastating if you are not adequately covered.
"Home contents insurance, though not legally required, should be regarded as a necessity."
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