Contents insurance is one of the most commonly purchased insurance policies in the UK. And this stands to reason, as who wouldn’t want to cover their belongings against risks outside of their control for a small fee? Despite this, 25 percent of Brits don’t have this coverage – even though it costs less than a pint of beer a month. So, what’s the hesitancy all about?
We recently conducted a survey amongst the British public to better understand the nation’s attitudes towards contents insurance. While some of the results were as expected, such as the majority of Brits having contents insurance, there were some surprises – and drastic differences based on age. Before we delve deeper into the results, let’s take a look at what contents insurance actually is first.
Put simply, contents insurance covers your possessions in your home against risks like fire, theft, or water damage. You’ll be compensated by your insurer if your possessions are lost or damaged as a result of one of these hazards. But modern policies can offer more protection than this by covering risks like accidental damage and theft of possessions you have on you while you are outside of your home. It’s also incredibly cheap – with some tariffs starting at less than £3 per month. Still, not everyone is convinced. To better understand this, we’ll analyse the results of our survey.
Providers see price as a key factor for winning new customers and retaining existing ones, and this is reflected in the competitive prices on offer.
Yet, one of the most striking results of the survey was that 33 percent of respondents cited contents insurance as being too expensive. But where does this idea come from? Let’s put things into context: Think of the cost of contents insurance in relation to the value of goods that people own. A Macbook Pro 13.3 costs £1349.97 at a leading UK retailer. If you paid contents insurance at a rate of £3 per month, you’d have to pay for over 40 years to meet its value. If it’s stolen, you would lose it instantly and either have to replace it or live without it – which we’re sure you’ll agree would be a total disaster. People likely misjudge how much their belongings are worth, with the average value of contents in UK homes is in excess of £35,000 – significantly more than the value of a Mac.
The general feeling of contents insurance being expensive doesn’t seem to match reality. Contents insurance is actually incredibly cheap – starting at less than the cost of a pint of beer.
Despite contents insurance being one of the most popular and common policies in the UK, more than half of the respondents to the Getsafe survey said they didn’t have a good understanding of what contents insurance is. Not only is this result somewhat surprising, it likely goes a long way in explaining why a quarter of the respondents don’t have contents insurance and also why a third believe it is too expensive.
Additionally, there appears to be a generational divide with regards to understanding contents insurance. Only 11 percent of 18 to 25 year olds said they had a good understanding of what’s covered by contents insurance, compared to 61 percent of those over 55 years of age. This suggests that insurance plays a greater role in the lives of older generations – even if coverage offers equally important benefits to young people. So, how can the insurance industry overcome this lack of knowledge and hesitancy when it comes to contents insurance – particularly among the younger generations?
The responsibility for making people enthusiastic and knowledgeable about insurance lies with the service provider rather than the consumer – just like it is with any product or service. Insurers must act to win new customers and maintain existing ones.
The insurance age gap is a great place to start. For too long, the insurance industry has been negatively perceived by the general public. Many people put off purchasing a policy until later in life at a point where they feel they need it. Reaching the next generation of customers is high on the agenda for any company looking to remain competitive. And this change is already underway.
At Getsafe, we are innovating to make insurance more digital, flexible, and simple as well as offering consumers more personal, customisable coverage. People expect the same online experience they get from other service providers, such as Netflix or Amazon. This is slowly becoming a reality, highlighted by us offering customers daily cancellation, tailored content on the topic of insurance, chatbots, transparent pricing, and a fully app-based experience.
Only by delivering this type of digital, mobile-first experience will insurers be able to vie for the attention of the new generation of insurance customers and make them enthusiastic about insurance. There is plenty of work to do, but progress is slowly starting to speed up. Getsafe is leading the insurance revolution – are you onboard?
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As you can see, contents insurance offers you real value – no matter what you own. Why not sign up today, starting from just £2.71 per month*?
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