ABI: Uncovered and exposed in the recession - one in four people cancel their home insurance

Wednesday, 10 June 2009 12:00 AM

Research published today (9 June) by the ABI on the day of its biennial conference reveals that almost a quarter of people admit to cancelling or not renewing their contents insurance to save money. Other insurances are also being ditched, despite the fear of being unable to cope with the unexpected being the biggest single concern for families in the recession.

These are the disturbing findings from a national survey of over 2,000 adults conducted by YouGov, on behalf of the ABI.

The survey highlights that:
. Nearly a quarter of people (22%) say that to save money in the last year they have cancelled or not renewed their home contents insurance. 17% say that they have cancelled or not renewed their buildings cover. In Scotland, the figures rise to 28% for contents and 21% for buildings.
. 13% have cancelled their life insurance.
. One in five (21%) say that they are seriously considering reducing or stopping saving.

This lack of cover is leaving many families even more exposed to their biggest fear in the recession: nearly half (49%) of those surveyed said that they currently worry about their in ability to cope with a sudden event, such as a burglary.

Stephen Haddrill, the ABI's Director General, said:

"Cutting back on insurance protection is a false economy. In these uncertain times, insurance provides a vital financial safety net to steer individuals, and families through the recession, as well as helping to provide long-term security.

"The insurance market remains very competitive, so shopping around can help you get a good deal, while ensuring that you are not at the mercy of the unexpected. Ditching insurance or reducing your cover must only be a last resort."

Other findings show that:

. When asked about the importance of saving: 45% said that they wanted to save more, but could not currently afford to do so. 15% think that the single most important step the Government can take to promote economic recovery is to introduce incentives to encourage saving. Those in Scotland see saving as more important than a year ago: 16%, compared to 10% in England and Wales.
. There is a difference in outlook between men and women. Over half (53%) of women worry about how they would cope with an unexpected event (compared to 43% of men). And 44% of women are worried about the adequacy of their pension (38% men), reflecting lower pensions among women.
. Asked what cutbacks people have or would be making: over two thirds (68%) said that family treats, such as eating out, were top of their list, followed by holidays (56%). Six out of ten women are prepared to reduce spending on clothes and shoes.

- ENDS -

Notes for Editors

1. Enquiries to:
Jonathan French 020 7216 7392 (Mobile: 07958 330 480)
Malcolm Tarling 020 7216 7410 (Mobile: 07776 147 667)
Erfan Hussain 020 7216 7411 (Mobile: 07712 841 184)
Kelly Ostler-Coyle 020 7216 7415 (Mobile: 07968 364 302)

2. The survey of 2,072 adults was conducted by YouGov between 29 May and 1 June 2009.

3. The ABI is the voice of the insurance and investment industry. Its members constitute over 90 per cent of the insurance market in the UK and 20 per cent across the EU. They control assets equivalent to a quarter of the UK's capital. They are the risk managers of the UK's economy and society. Through the ABI their voice is heard in Government and in public debate on insurance, savings and investment matters.

4. An ISDN line is available for broadcasts.

5. More news and information from the ABI is available on our web site, www.abi.org.uk.

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