HNW Clients: NFU Mutual Launches New Under-Insurance Game

This is a good way to involve clients in the not-too-exciting business of insurance valuations. Well, not exciting until you need to make a claim of course. Here’s the word;

Home insurer NFU Mutual has launched an interactive game to help people understand how it easy it can be to become underinsured, as a survey has found that only 21% of respondents know how much it would cost to replace or repair their possessions.

The game, which can be found here, challenges players to identify the more valuable contents in two pictures of identical homes, drawing attention to the often unexpected items which can push up the cost of repairing or replacing possessions. 

Underinsurance has always been a problem for insurers and insurance customers, but inflation, increased repair costs and the heightening value of certain items mean the issue has grown in recent years. 

A recent survey of 1,000 affluent homeowners, conducted by OnePoll for NFU Mutual, found that well over three quarters of respondents were at risk of underinsurance of both their property and possessions. Just 23% of respondents were confident they knew exactly how much it would cost to repair or restore their property, with 13% admitting to having no idea. For their home content, just 21% knew exactly how much it would cost to repair or replace their possessions, with 13% again admitting to having no idea. 

The survey shows that many people may be vulnerable to underinsurance by underestimating the extent or value of their possessions. 

Dawn Blazier, Head of Bespoke Home Insurance at NFU Mutual, said: 

“Underinsurance is a persistent and concerning trend which can impact insurers’ ability to get customers back to where they were before loss or damage occurred. Insurance only covers what you pay for it to cover, so if you do not have the value reflected you may find your insurer can’t pay enough to restore your property. 

“We hope this interactive game will help customers think about their homes and contents and consider whether they have all the cover they need. 

“There are a number of factors at play in underinsurance. One of these is that the cost to repair or replace an item can often be more than what you paid for it.  

“An antique item of furniture, for example, may have been purchased for £200 several years ago but might cost £1,000 to replace like-for-like now. Similarly, your old record collection, library or artwork may have increased in value significantly since you first bought it. 

“Even more modern pieces are likely to cost more to replace now then when they were purchased, and many people will have thousands of pounds worth of clothes without knowing it – even discounting rare and designer items. 

“I’d urge everyone to think about their possessions and contact their insurer if they think they might not have the cover they need.”