Home insurance costs fell 16% last year as cash-strapped consumers reassess their insurance needs to ensure they are not paying over the odds.
According to a study carried out by getcover.ie, economic circumstances and a general tightening of the purse strings have seen consumers give more consideration to their home insurance needs, with many revising downwards sums insured as rebuild costs decrease.
Louise Ledwidge of Getcover.ie said the reassessment of sums insured inevitably led to a reduction in cover last year.
“Over the last two to three years rebuilding costs for homes have dropped considerably. Previously, this had been an issue and consumers were not aware that a reassessment of their building sum insured should be undertaken to reduce premiums and that the onus for doing this falls to them not their insurer.”
The study highlights a reduction in the cover last year, with the average cover dropping by 16% year-on-year from €248,000 to €208,000.
Similarly, contents insurance, which is either calculated independently or is automatically a percentage of the building sums assured, has also fallen over the past year, to an average €32,000.
“It stands to reason that many people are now less likely to update home furnishings or to splash out on expensive jewellery, so the value of contents insurance was always going to fall. The replacement cost of many household items has also fallen as retailers struggle to compete for reduced consumer demand,” said Ms Ledwidge.
The insurance specialist pointed out that the main driver of the reduced sums being insured was a more savvy consumer.
“Upon renewal, people now ask more questions, understand more, and are also stripping back on those policy extras that have little relevance for them. From this recession has emerged a new wave of tougher, price conscious, and value-savvy consumers who are prepared to go through the contract with a fine-tooth comb to achieve cost savings,” she said.
Getcover.ie is one of Ireland’s largest online travel, household, and health insurance providers.
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