The new research, commissioned by comparison website Gocompare.com, also revealed that 24 per cent of people just read and file their home insurance renewal documents, allowing the policy to automatically renew – rather than seeking a better deal.
But householders could potentially be missing out on significant savings by simply allowing their policies to renew, rather than taking the time to understand what they are being offered.
Worse still, by not checking any new terms and conditions, or reviewing whether the cover continues to meet their needs, they could be buying an inappropriate policy or leaving themselves underinsured.
Of the documents they receive through the post, 26 per cent of people find their household insurance renewal the hardest to understand, followed by utility bills (gas: 20 per cent, electricity: 16 per cent), their landline phone bill (11 per cent) and their water bill (8 per cent).
Hayley Parsons, chief executive of Gocompare.com commented: “The language used and the technical nature of renewal documents make them a less than compelling read, but renewals contain important information which could affect your financial wealth. So, it is essential that you spend the time to check the policy you are being offered continues to meet your needs. In particular, note any new policy exclusions and conditions and, check that the sum insured is sufficient to include any recently acquired possessions.”
Parsons concluded: “For many households, shopping around for the best deal is a financial necessity in the current economic environment. So we were surprised to see that nearly a quarter of people simply read and file their home insurance renewal, allowing the policy to automatically renew. This may seem an easy option – but it could cost householders dear. The automatic renewal process greatly benefits insurers by helping them to retain customers – often at higher premiums than they may offer to new customers.”
