Millions of UK homes at risk of underinsurance

Millions of households across the UK are underinsured for their contents insurance, new research from Go.Compare has revealed.

Published yesterday (22 February 2024), the data showed that an estimated 9.3m households do not have any contents insurance, meaning around £276bn worth of possessions are uninsured.

Go.Compare warned that this would mean millions will not receive the funds they need to repair or replace their possessions if they need to claim.

The calculations looked at the number of residential properties in the UK and ABI statistics on the percentage of underinsured homes.

Ceri McMillan, home insurance expert at Go.Compare, said: “It’s shocking to see that so many might not have the coverage they need to keep their possessions safe.

“Millions of pounds are at risk of being lost, highlighting that many of us need to take action to make sure our possessions are properly protected.”

Pitfalls

The insurance comparison site said a possible reason for the current level of underinsurance was that many people “might be falling foul of insurance pitfalls”.

It said that less than a quarter knew how to calculate accurately the worth of their possessions, meaning 76% were at risk of having insufficient coverage from their policy.

“While it might not be the first thing on your mind, it’s critical that you update the value of your contents regularly,” McMillan said.

“Otherwise, you risk being underinsured and might not get the funds you need in a worst-case scenario like a fire, flood or theft. This results in the cruel double-whammy of losing your possessions and having to absorb the financial cost of replacing them.

“A good way of getting into the habit of updating your insurance is to revalue your possessions whenever your policy renews. You should also consider updating it after you’ve made any big purchases.”