Not The Time To Skimp On Insurance, North East Homeowners Warned

An insurance expert has cautioned householders in the region against cutting corners on home insurance as a way of coping with the cost-of-living crisis.

John Murphy, of insurance broker Lycetts, has spoken out following a YouGov survey that revealed 11 per cent of Britons would cut back on premiums and policies if the crisis affected their family budget.

“At a time like this, you need all the protection you can get, and economising on vital cover could leave you shouldering a heavy financial burden,” he said.
Inflation currently stands at 9.4 per cent – the highest in 40 years – and the Bank of England predicts it could hit 12 per cent by the autumn.

“In light of such rises, it is essential to check contents insurance policies. Items may have increased in value since purchase, and the sums they are insured for may not reflect their true value,” Murphy said.

“To avoid being underinsured, it is advisable to arrange a revaluation of significant items.

“Similarly, it is worth examining any building insurance policies you may have, with your insurer. The supply shortage and inflated prices of building materials caused by the combination of the pandemic, the conflict in the Ukraine and inflation, may mean that repair and rebuild costs exceed expectations. This should be reflected in the policy.”

Murphy pointed out that as well as potentially ending up thousands of pounds out of pocket in the middle of a cost-of-living crisis, those who choose to let contents insurance lapse entirely could find their risk profile adversely affected in the long-term.

“A homeowner may be regarded as financially irresponsible when attempting to start a new insurance policy at a future date,” he added. “This could mean higher premiums.”

“It is important to seek advice from an experienced insurer or broker and review your current insurance before contemplating making any changes to your arrangements.

“Short-term savings could result in long-term loss.

“Insurance offers security against the unexpected. You cannot second guess the unexpected, but you can take all possible precautions to minimise the damage it can cause.”