How we’re combating home underinsurance
At Ageas, in partnerships with brokers, we’re committed to ensuring customers are adequately protected, and that the products we provide suitable for their customer’s needs.
Recently, we’ve identified a rising issue with homes being underinsured, particularly with larger properties written on our bedroom-rated products, which have a £1,000,000 maximum claims limit.
Our Commitment to You
As a responsible insurer, we’ve been working on a programme of measures to:
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Identify policies where the £1,000,000 limit is not adequate to rebuild the property in full
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Adjust our acceptance criteria to avoid any further cases of underinsurance
Enhancing customer understanding
Our research indicates that many customers don’t understand the potential consequences of being underinsured. There is a common misconception that insurers will pay any claim up to the maximum of the sum Insured, which is not the case. In some circumstances, cover could be invalidated altogether, and most commonly, the insurer will only pay a proportion of the loss, leaving the customer to bear the remaining cost of rebuilding or repairing.
Customers also often don’t understand what needs to be included in the rebuilding costs. While some calculators are available, they should be used with caution as they don’t adequately cater to special features of risks.
What are rebuilding costs?
Rebuilding costs include:
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The cost to rebuild the home to current building regulation and planning requirements
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The cost of demolition, clearing the site, and removing debris
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The cost of professional fees, such as architects, engineers, and surveyors
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The cost of reinstating any special features of the property, such as multiple storeys, outbuildings, perimeter walls, landscaping, ponds, tennis courts, swimming pools, converted basements, decorative finishes, or any requirements for its listed status or conservation area.
Temporary Acceptance Criteria Changes
From early December, we will be temporarily restricting new business on our Standard House Guard product until we have a more permanent solution. CDL and Acturis users will see the following restrictions for risks where Buildings or Combined cover is requested:
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Maximum of 5 bedrooms (4 bedrooms for listed properties)
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Maximum of 4 bathrooms
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Maximum of 15 rooms (CDL only)
Sum insured rated business (over £1,000,000 and up to £1,500,000) will still be acceptable but must fit the above temporary criteria.
New Business: 30-Day Quote Guarantee
There will be some cases quoted successfully that will no longer be acceptable at the point you try to process the new business. Where all other details are unaltered, and provided that you and the customer are comfortable that this product with the £1,000,000 limit will be sufficient for their needs, we’ll honour the 30-day quote guarantee. Please contact us at policyservices@ageas.co.uk and we’ll discuss how this can be achieved
Existing Business that is currently underinsured
We’re also identifying risks currently insured with us where we think the buildings sum insured provided is likely to be inadequate. We’ll be in contact with you regarding any of your customers’ policies that are identified.
We appreciate your co-operation and understanding as we work together to ensure your customers are adequately protected. If you have any questions or need further assistance, please do not hesitate to reach out to your usual Ageas contact or via connect@ageas.co.uk.