Commenting on Esure’s decision, David Quick, CETA’s Managing Director said: “The national media coverage generated by Esure’s announcement provides an excellent marketing opportunity for intermediaries to contact clients to review their household cover”.
“Many homeowners whose properties are potentially at risk from flooding will now be concerned about their ability to obtain cover in the future. While other insurers will undoubtedly follow Esure’s lead and stop insuring some properties, there is still time for intermediaries to obtain the cover that their clients need. The best advice we can give intermediaries and their clients is to act sooner rather than later’.
CETA recommends that intermediaries should check whether clients have contents cover. While most homeowners have buildings cover in place, usually as a result of a condition attached to their mortgage, recent research has found that over 40% of households do not have any contents cover. In addition, those that do, have little idea of the true value of their possessions, and are often significantly under insured.
For homeowners who have no insurance but live in high risk areas, CETA’s advice to intermediaries is that putting adequate cover in place is essential. The properties most at risk can be easily identified and should be targeted through local mail shots and public relations activity.
“Insurers are increasingly taking a much tougher view on which properties they will insure’ explained David Quick. “However, it is not an exact science and at the moment an area regarded as a bad risk by one insurer, based upon their claims history, may not be by another. This allows intermediaries who are prepared to shop around, to get the required cover at a price a homeowner could not obtain themselves”.
“Unlike the rest of Europe, in Britain, flood protection is built into all buildings and contents policies. Insurers have promised to provide cover in high flood risk until the end of 2002. People living in these areas have about six months left to put the cover they need in place. Time is running out. After December it might be too late. Then some people may then find that their homes and possessions have become uninsurable. Its simply not a risk worth taking “.
