One in Twelve Homeowners Consider Cutting Insurance – But, at What Cost?

A survey from Gocompare.com, has found that homeowners are cutting back to save money – but at what risk? Out of the 2,000 adults surveyed, eight percent would consider not renewing their home contents insurance and eight percent would consider not renewing their home buildings insurance. Now, while that may not seem like a lot – that is still 1 in 12 homeowners!

Taking into the consideration the recent spate of natural disasters that have been happening worldwide so far this year, it’s important for insurance providers to stay in close contact with their customers and educate them about all of the insurance options they have – the pros, the cons, and the “what ifs”. What if your basement floods – is basic insurance going to protect you? What if you lose a piece of fine art or collectibles? How do you make sure you get an accurate valuation? Do you know about contents coverage and your responsibilities when filing a claim?

While cutting back on spending can help make ends meet in hard times, the fact that many consumers are also cutting back on homeowners insurance is a worrisome trend for carriers and their customers. This survey data points to an opportunity for carriers to mobilize their brokers and agents to proactively reach out to customers at least once a year and invite them for a consultation to review their current coverage and make sure it’s adequate. A proactive approach like this could help carriers to act as advocates to their customers, helping them better understand the value of keeping their insurance coverage even in tough times. More contact with customers could also provide brokers and agents with opportunities to upsell additional coverage and services to customers who may be unaware that they are underinsured.

Our own Jon McNeill provides insights on this approach for agents, brokers and carriers in an article he wrote for American Agent & Broker Magazine. Called “Get Smart on Contents Claims,” Jon’s article provides practical tips that agents and brokers can use to educate the insured so that they understand the right level of coverage they need for adequate protection. Education can be a great tool for battling insurance coverage cut backs by many insured who feel they have no other option.

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