Do You Have an 'Insurance Personality'?

A recent survey conducted by Readers Digest has resulted in finance experts pigeon-holing the way we spend money into five different categories. Organising the habits of UK spenders in this way is quite funny, but does it really tell us anything new? With the insurance industry still feeling the recession, and more of us eager to cut back on home and life insurance, I came up with the idea that discovering our 'Insurance Personality' might be more worthwhile.

According to Readers Digest, there are five different types of spenders in the UK: Amblers (who don't bother to check their balance until trouble hits), Evaders (who leave bank statements unopened and never admit to being in debt), Hoarders (who keep track of their money meticulously), Validators (who spend to show they can) and Splurgers (who just can't help spending. These certainly go some way to showing that we perhaps spend too much, but such research is misleading - I mean an 'Evader' is not necessarily financially immature; perhaps they do not need to check their statements?

However, if we take RD's lead and attribute their methods to the way we are purchasing (or not purchasing) insurance, wouldn't that give us a little more focus as to whether we are using our money sensibly? I haven't the resources to survey 1,500 people but I would like to hazard a guess at what types of 'Insurance Personalities' might exist amongst us:

First of let's start simply with those who are sensible, we'll call them 'Sentients', i.e. that they have the sense that there is always the possibility of risk and that they are always sure they have correct full-cover insurance for the sake of security. These individuals will have fully comprehensive car insurance despite the extra cost, and will get life insurance well before starting a family.

Next we have the 'Protectors'. These are those individuals who think of insurance more in terms of others around them than protecting themselves. For instance, a 'Protector' will quite easily settle for Third Party insurance on their car and will probably only consider purchasing life insurance after having children or getting married.

Then we have the 'Essentialists'. As I'm sure you can guess, these types are particularly prevalent during times of recession. They obtain insurance only if it is entirely necessary (i.e. car insurance) - but these are the ones who'll cut their home and life insurance during times of financial hardship.

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