Under Insuring

The Association of British Insurers has recently reported an increase in the number of fraudulent claims that its members are receiving. This is at the same time as statistics relating to burglary go up in the wake of the recession. At a time when people most need their home insurance it seems that less people have it because they are trying to get cheaper deals by offering inaccurate information and thus unknowingly voiding their policies.

Whilst this might seem like a leap, other research supports the idea of people deliberately under-insuring themselves. According to recent statistics the average British home is under-insured on the value of its contents by as much as £8,000.

That is not to suggest that everyone who has miscalculated the value of their possessions is committing insurance fraud. There is a possibility that people may have not taken into account new items that they may have bought and not counted for inflation and the rise in the price of precious metals that has raised the cost of jewelry to a new high.

Still, that someone could accidentally under-insure themselves by £8,000 seems implausible in the extreme. It’s more likely that some people are massively under-insuring their homes in order to get cheaper insurance policies.

Now, this isn’t even one of those ideas that seems sensible on the surface. Whilst they might save money on their monthly bills, if they ever have to make a claim it’s more than likely that the insurance company will declare the policy invalid and refuse to pay out. Of course the gamble is that they won’t have to make a claim, but when you’re talking about potentially hundreds of thousands pounds of damage, it surely is better just to pay for the right policy?

Another curiosity is a report that suggests that a large proportion of people are double-insuring themselves. Many expensive items come with their own insurance that is an extra and unnecessary cost as the item is covered by the insurance policy that the homeowner already has.

Admittedly there are many situations where it’s cheaper to have really expensive items insured separately, but even then you get a better deal by having these objects insured privately rather than through the company that sold you the tv in the first place.

Home insurance is a vital product as it offers you financial protection to a degree that you couldn’t get any other way. It’s possible to get really good deals, even in the current economic climate, and one company that is worth a look is Co-Operative Insurance.

The Co-Operative Insurance. Let us help your home insurance needs.