Consumers believe in the product

Approximately seven out of ten people have home insurance, with combined buildings and contents cover the most common arrangement.

Essential Purchase

Although consumers may be looking for ways to save money in the current climate, this has not led to widespread cancellations of home insurance policies. They are seen as an essential purchase for many households.

Savvy customers more value conscious

Instead of cancelling policies, consumers are looking around for value. This doesn’t necessarily mean taking the cheapest policy, but one that offers good value for money.

Buildings cover an obligation

Consumers are still obliged to take out buildings cover when they purchase a property with a mortgage. As consumers become more value conscious, they are looking beyond what their mortgage provider offers.

Increase in ownership of high value items

Consumers have increased their ownership of high value items such as televisions, mobile phones, home computers and DVD players which means their contents cover should increase proportionally.

Increasing levels of theft

During economic uncertainty, levels of theft and burglary tend to rise making it all the more important for consumers to be insured.

Online Vs. Offline

Despite the rise in comparison websites, only 7% of policies are sold through these sites. Over 60% are sold either over the phone or face-to-face.

A growing market

The number of households is predicted to increase by more than 20% over the next two decades. This should lead to an increase in the underlying market for home insurance policies.

Steady long term growth

Mintel have forecast that there will be steady growth in the home insurance market from £6.76 billion in 2010 to £7.64 billion in 2014. They believe contents insurance will grow slightly ahead of buildings insurance as the mortgage market continues to stagnate.

Rental Market

As housing sales fall, more people are moving into rented property where there is still a requirement for contents insurance.

Extreme weather

Unpredictable weather patterns mean that more households are at risk from extreme weather events, such as flooding, making home insurance even more crucial.

Tackling under insurance

Although ownership of high value items is on the increase consumers are still looking to reduce their insurance costs and often take out stripped down products with aggregators which in many cases leaves them underinsured.

Price important but value more important

Consumers want value for money. They want a good basic cover that they can add to if necessary. They tend to disapprove of promotional perks.

Getting the right cover

Consumers don’t want to be underinsured as this leads to problems when a claim is made.

Trusting the claims process

29% of consumers don’t trust insurers to pay out in the event of a claim, so it’s important to ensure your clients are fully insured and use a provider with a good track record of claims.

Trusted brand

Even when consumers visit a price-comparison site they will often opt for a familiar and trusted brand over a less known provider and be prepared to pay more for the policy.

Benefits of education

Comparison websites tend to hook consumers with low cost policies, but these policies may not be comprehensive enough for the consumer’s needs. Brokers therefore have a valuable role to play in educating consumers that the right cover is not always the cheapest.

Target your market

Twice as many people think that it’s worth paying more for quality cover than think low premiums are the most important thing when choosing home insurance cover. Many professionals (AB and C1 socio economic groups) aged 35 and over believe it’s foolish not to have insurance and that they have possessions worth covering.

A chance to stay in touch

With so many households underinsured, consider contacting your existing clients to make sure they update their cover regularly in line with their changing circumstances.