You probably know the value of your house, but do you know the value of what’s inside it? If not, the chances are that your home contents insurance may not provide enough cover should the worst happen.
You wouldn’t be alone. Only just over half (57%) of the people we questioned as part of our latest research* are confident they’ve correctly valued the contents of their home. Among 18 to 34-year-olds, that percentage falls to just 38%, with a third of that age group pretty sure they’ve valued incorrectly.
According to our Insurance Spotlight Report, 2019, if you’re younger, you’re more likely to take a relaxed approach to contents insurance. A fifth of 18-34 year olds questioned don’t even have this cover, while 14% confess to having undervalued simply because they couldn’t be bothered to calculate the correct amount. Perhaps most surprisingly, 3% of all age groups admit that they’ve deliberately undervalued their contents to get cheaper insurance.
While your home contents insurance should cover everything in your house that you’d need to replace, it’s particularly important to ensure that your policy covers high-value items. These can be named specifically on your policy just to make sure that they’re covered, and you’ll need to know their value accurately.
In our research, we found that 14% of people have never reviewed the value of high-value items in their home, which could result in an underpayment or even the rejection of an insurance claim. What’s more, Many people don’t realise that the value of their jewellery can significantly fluctuate, so it’s a good idea to have high-value items reassessed every three years to ensure they’re covered for the correct amount.
How secure is your home?
Another dimension that many people overlook is the impact of location on the price of a home contents insurance policy. Living in a high-crime area, you’ll be more at risk of burglary, which means a higher likelihood of a burglary claim and a higher policy price. However, our research shows that almost a fifth of people (18%) are either unsure about this or don’t think that this is the case.
Of course, having the right home security measures in place can go some way to ensuring that your home is as safe as possible, even in a higher-crime area. Many of those we questioned in our survey weren’t aware which measures would help lower their premiums, and many admitting they don’t know how to make their home safer.
Security measures really do make a difference, and security cameras, alarms, locks, timer lights and Neighbourhood Watch schemes are all ways to sleep more soundly at night while saving money on insurance. Yet despite the obvious benefits of home security systems, one in ten (9%) people don’t realise that CCTV affects the price of their policy, and 7% state that a burglar alarm has no positive effect on the cost of home insurance.
With a burglar alarm system often reducing the price of a policy, it’s surprising that 65% of people haven’t informed their insurance provider that they have one, thereby missing out on a potential reduction in their premium. Even more surprisingly, 22% of those who have a burglar alarm often forget to set it, presumably not realising that this could void an insurance claim.
* The A-Plan Insurance Spotlight Report, 2019 aims to start a conversation about increased transparency – investigating consumer attitudes and behaviours towards home, car and personal insurance to establish where knowledge gaps exist and generate ideas to help consumers and communities better protect themselves. Statistics quoted are based on the results of nationally representative independent research of 2,000 UK consumers conducted by Netfluential on our behalf.