So, why do we buy home insurance?

So, why do we buy home insurance?

Our homes are our castles, and making sure they’re protected is important. Helping customers when they need us most is what we do best. After all, that’s what insurance is all about.

Peace of mind

Research conducted among 2,000 consumers on behalf of Aviva2 shows that the most common reason for having home insurance is peace of mind – in fact, more than half of homeowners (57%) said this is why they have it. It’s a factor that seems to become more important with age, as 67% of over 65s cited peace of mind as their top priority when it comes to protecting their homes.

…and financial security

Peace of mind is good to have, but having a financial safety net in place is also another reason for buying insurance. One in ten (11%) homeowners say that they couldn’t afford to pay a claim themselves if they didn’t have insurance, with a further 10% saying that home repairs carried out by reputable builders is also important to them.

Insurance is often seen as a grudge purchase; something that we don’t necessarily want to buy, but feel like we have to – and in the case of motor insurance, it’s compulsory. But in spite of that, a staggering 80% of people we surveyed said they’d still buy home insurance even if they didn’t have to. Why? Because peace of mind and financial security are especially important to us.

Even though insurance is key to giving us peace of mind, only a third (32%) of those surveyed read their documents in full, while one in ten (8%) don’t read their documents at all.  

Clearly, then, customer education is paramount, but insurers can also play their part by making these documents easier to understand in order to help ensure consumers know exactly what they’re buying.

Frustrations

Our research lays bare some of the frustrations of homeowners towards typical insurance practices:

Frustrations

Jargon can lead to confusion and, in some cases, a lack of understanding about what home insurance covers.

Drop the jargon

In 2015 in the UK, Aviva received almost 815,000 insurance claims and paid out more than £2.2 billion to customers3.  Industry-wide, 84% of home insurance claims are successful4. But as an industry, there’s more that insurers can do to help people understand their policies.



2 Research conducted by ICM with 2,000 consumers; 1,000 with home insurance and 1,000 motor insurance consumers.  May 2016.

3 Analysis of Aviva’s claims costs 2015

4 Association of British Insurers (ABI) claims analysis 2014/2015


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