+353-1-416-8900REST OF WORLD
+44-20-3973-8888REST OF WORLD
1-917-300-0470EAST COAST U.S
1-800-526-8630U.S. (TOLL FREE)

PRINTER FRIENDLY

UK Home Insurance Market 2021: Consumer Research Report

  • ID: 5313564
  • Report
  • April 2021
  • Region: United Kingdom
  • 70 Pages
  • IRN Research
73% of Adults Own Home Insurance

This report examines the motivations, experiences and opinions of the UK home insurance customer. It will identify and analyse consumer attitudes towards motor insurance, look at the claims experience of drivers, and investigate why they choose one route to purchase over another. In addition, it will explore how price sensitivity is impacting the market and how COVID-19 has affected behaviours and experiences. Similar research was run in 2019 and comparisons between results in 2019 and 2021 are also made.

In 2021, 73% of consumers said they owned any type of home insurance, which is marginally up on the percentage in 2019. When taking out home insurance consumers show a preference for combined contents and buildings insurance and they prefer to buy standalone policies: relatively few own home insurance policies as part of a multicover insurance or which came with a packaged bank account.

A new customer journey begins each year. Each year, over 90% of combined buildings and contents home insurance policyholders are existing policyholders and their choice comes down to either renewing with an existing provider (around half renew each year) or switching from one provider to another (around four-in-ten switch each year). For contents only and building only insurance a greater proportion of policyholders embarking on a new customer journey each year are new market entrants - i.e., buying home insurance for the first time. Even if renewing, policyholders generally still embark on a new customer journey: over eight-in-ten of policyholders owning combined cover who renew still search for alternatives policies and/or negotiate for a revised deal from their provider before they agree to renew. 

Between 2019 and 2021, across all three home insurance policy types, the incidence of claiming in the past five years has declined. Across all three policy types in 2021, less than 10% of policyholders had claimed within the past year. The claims process seems to run smoothly for most claimants.

One-third of home insurance policyholders have been impacted by COVID-19 when it comes to their motor insurance. The most common actions/experiences centre on premiums - either switching provider/policy to save money or being offered a rebate by their provider. The policyholders most impacted by COVID-19 tend to be younger professional policyholders, aged under the age of 45, from the AB social grades, who have made a recent claim. 

Other findings from the report, include:

  • Most insurance policyholders are price focused. A majority put price first when evaluating a policy and cover second. However, the final price paid, and the level of cover achieved by policyholders is often the outcome of policyholder/insurance provider negotiation: almost seven in ten policyholders negotiate with their provider before buying a policy.
  • When looking for insurance deals at the start of a customer journey, price comparison websites (PCWs) are by far the most popular resource. When it comes to purchasing, policyholders tend to buy their policies either directly from the provider or via PCWs, with PCWs the main channels for purchasing.
  • Just over one-in-ten policyholders have Smart Home telematics installed in their homes and penetration has declined over 2019 and 2021, but there has been a slight increase in a willingness to get Smart Home technology installed.

For this report, the publisher commissioned research from MIS Group’s UK panel. The research was structured so that 2,002 nationally representative consumers aged 18+ were asked if they owned an insurance policy. This generated 1,454 individuals who owned a motor insurance policy. Similar research was run in 2019, with a sample of 1,457 home insurance policyholders.

Note: Product cover images may vary from those shown

1. Executive Summary

  • Over seven-in-ten consumers own home insurance
  • There is potential for home telematics insurance, but current uptake is low
  • The customer journey merry-go-round
  • Policyholders like to discover deals online, mainly via PCWs
  • Policies are purchased primarily via PCWs
  • Home insurance purchasers are price focused
  • Brands are important but are not everything
  • Most policyholders have a good experience
  • Less than one-in-ten have claimed in the past year
  • The claims process seems to run smoothly for most
  • Almost one-third have been impacted by COVID-19

2. Introduction

3. Profile of the Insured

  • Over seven-in-ten adults own any type of home insurance
  • Home insurance policyholders like to minimise their risks

4. The Type of Insurance Owned

  • Consumers prefer buying combined buildings and contents cover
  • Homeowners represent almost seven-in-ten insured adults
  • Most policyholders buy standalone policies
  • Most policyholders pay for their insurance annually
  • There is potential for home telematics insurance but current uptake is low

5. The Customer Journey Begins

  • Most policy buyers are repeating a purchase
  • Age, tenure and social grade prime influences on action
  • The importance of the renewal prompt
  • With over one-third switching provider, loyalty is in short supply
  • And the revolving door of switching continues to turn
  • Switching is strongly price led
  • Most of those renewing also start a new journey
  • Confident managerial policyholders the most likely to search before renewing
  • Almost half of those renewing without searching still try and get a better deal

6. Buying a Policy: Finding the Right Deal

  • Price comparison websites the prime research resource
  • Buildings only policyholders the most likely to seek professional advice
  • PCWs facilitate switching
  • Ease of use and information the key positives of PCWs
  • The PCW dominance is here to stay
  • Policies are purchased primarily from PCWs

7. Policy Acquisition: Price Negotiation

  • By their nature, policyholders are price sensitive
  • Affluence and willingness to switch key determinants of price focus
  • Brands are important but they are not everything
  • The final price/cover offer is the result of a negotiated settlement
  • But can consumers negotiate from a position of strength?
  • It’s the volume of paperwork that limits knowledge

8. Being a Policyholder

  • For most policyholders, owning a policy is a problem-free experience
  • Online policy management now becoming the norm
  • Major decline in claiming
  • Those employed in managerial occupations the most likely to claim
  • The claims process goes smoothly for most claimants, resulting in high levels of satisfaction

9. Impact of COVID-19

  • One-third of policyholders have been impacted by COVID-19

List of Figures
Figure 1 Penetration of home ownership/renting/home insurance by gender, age, income and social grade
Figure 2 The penetration of home ownership/renting and home insurance by region
Figure 3 Attitudes to buying insurance by home insurance policyholders
Figure 4 The types of home insurance policies owned, 2019/2020
Figure 5 The profile of the owners of home insurance by key demographics
Figure 6 How home insurance was acquired, 2019/2021
Figure 7 How home insurance policies are paid for, 2019/2021
Figure 8 The ownership and interest in Smart Home technologies, 2019/2021
Figure 9 How the current home insurance policy was acquired, 2019/2021
Figure 10 How the current insurance for the main home was acquired
Figure 11 The time spent with the current provider, 2019/2021
Figure 12 The % of policyholders thinking of switching provider over the next year
Figure 13 The factors that caused policyholders to switch provider
Figure 14 Actions taken before renewing, 2019/2021
Figure 15 Key characteristics of policyholders who search before renewing
Figure 16 The activities of policyholders who renew at renewal time
Figure 17 The resources consulted before arranging insurance over the past two years, 2019/2021
Figure 18 Resources consulted over the past two years, by type of insurance owned
Figure 19 Information resources consulted by method of policy acquisition
Figure 20 Policyholder attitudes towards PCWs
Figure 21 Where policyholders would look to compare deals, 2019/2021
Figure 22 Where the last home insurance policy was acquired from
Figure 23 The price focus when buying home insurance by type of policy held
Figure 24 The price focus when buying home insurance by policyholder characteristics
Figure 25 Did policyholders buy from a well-known insurer / provider rather than cheaper alternatives
Figure 26 Negotiation with the insurer when taking out a new policy or renewing
Figure 27 How policyholders read their policy documents
Figure 28 Why policy documentation is not read in detail
Figure 29 The percentage of policyholder satisfied and encountering problems, 2019/2021
Figure 30 Portal access, 2019/2021
Figure 31 The incidence of claiming on home insurance, 2019/2021
Figure 32 The incidence of making a claim in the past year by key demographics and attitudes
Figure 33 Claimant opinion of their last home insurance claim, 2019/2021
Figure 34 The impact of COVID-19 on home insurance policyholders

Note: Product cover images may vary from those shown

Loading
LOADING...

Adroll
adroll