Gaps in Home Insurance

The problem of a gap in home contents insurance is one that has been documented recently, with examples of a sudden rise in the value of contents due to events such as getting married. However according to insurer More Than singletons are also running an insurance risk and not only of being underinsured but completely uninsured, despite having high value home contents. The trend to get married later, or indeed not get married at all and higher divorce rates means there are a higher number of single person households with large disposable incomes. It’s estimated the average disposable income will rise to £30,000 by 2008 and one in three single person households currently have no home contents insurance at all.

Not only is the problem in the future when incomes will rise, the value of a single person household now stands at £19,284 according to More Than. Without any insurance cover in the event of a crisis such as fire or theft that’s a lot to replace and it’s easy to see where the high value comes in. Consider the fact that many households nowadays contain high value contents such as dvd players, computers and other entertainment and technological gadgets, expensive clothing and not to mention the cd and dvd collections to go alongside. Not only are these high value items which bump up the value of home contents but also they are expensive to replace and easy to transport in the event of theft.

In fact, according to More Than the uninsured contents of single person households was £38.1 billion in 2001 and will rise to £48.2 by 2021 if things continue as they are. Not only is our disposable income set to rise either, single person households are set to increase too, the highest predicted rise being in the south east where a 41% rise is predicted by 2021. So it’s even more important that Britons start to consider appropriate levels of insurance even when they’re living alone as well as if and when they get married or start a family.

When obtaining home contents insurance it’s also worth noting other gaps in home insurance documented. Recently it was noted that many people are underinsured due to replacing or upgrading products and indeed sometimes it would seem hard to imagine how our contents could be worth so much. However as mentioned, high value items raise the value of home contents considerably and therefore it’s important to make sure your cover reflects this, some consumers chose to go for unlimited cover which offers peace of mind and cuts out the worrying that your new purchase may have put you over the claim limit.

5/7/05