7th April 2016
- 20% of first time buyers aged 25-34 have underinsured homes
- 10% of first time buyers admitted to only buying buildings insurance after they had moved into their home
- a third (31%) of first time buyers have bought furniture before measuring up.
As the home buying season gets into full swing, research from Co-op Insurance has revealed the common insurance pitfalls first time buyers are making when it comes to purchasing their first home.
One in five first time buyers, between the ages of 25 and 34, (20%) are under-insuring their homes, leaving their property and belongings exposed, as they admit to purchasing only buildings or contents insurance, rather than the two combined.*
Across all age groups, almost one in 10 (9%) of first time buyers admitted to only purchasing buildings insurance after they had moved into their home, despite it being a purchaser responsibility to have buildings insurance in place from the date of exchange. One in five (19%) also didn’t have contents insurance in place before they moved in to a property.
Insurance mistakes are not the only ones being made by first time buyers, with many rushing ahead buying furniture for their new home that won’t fit. Almost a third (31%) said they had bought furniture before measuring up the size of the rooms accurately. Of these, one in four (25%) said it was a nightmare to get their furnishings into their home, 16% had to remove a window, and 7% actually caused damage to their new home by moving the furniture in.
Caroline Hunter, Head of Home Insurance at Co-op, said: “The research shows that there are a number of first time buyers who may be getting their priorities wrong when it comes to moving. Buying a property is a complex process and a lack of understanding means that many people are not adequately covered when it comes to insurance.
“Making sure you have buildings insurance in place, at the time of exchange of contracts, is important because that is when you become legally responsible for the property. For example, if the property is affected by fire or malicious damage before the completion process is finalised, you could be liable for these costs without it. Each mortgage provider will have their own rules and they may check this before lending money to a potential home buyer.
“It is also wise to have contents insurance in place before you move. Often this will cover goods in transit, so it could save you money, as you may not need to purchase insurance from a removals company. Check with your insurer becauuse there may be requirements that items of a fragile nature are packed by professionals and small high value items may not be covered, such as jewellery – you will be better off transporting these yourself.”
Co-op Insurance offers the following top tips for those moving home:
- buildings insurance is extremely important, as it should cover the rebuild cost of the main elements of your home including walls, floors, windows, roof and doors, as well as other outdoor structures such garages, sheds, drives, fences and gates. It also covers permanent fittings, for example kitchens and bathrooms
- Make sure you have buildings insurance in place at the time you exchange contracts as this is when you take legal responsibility for your new property. Although buildings insurance can be a condition of your mortgage, it doesn’t mean you have to buy a policy from your lender
- contents insurance will protect your belongings, eg., things that you keep in your home, like furniture, carpets, curtains TVs, and other valuable items, such as jewellery and mobile phones. Additional cover may need to be added if you wish to cover these items outside your home
- contents Insurance is optional but it is sensible to have this in place starting from the day you move your belongings into the new property (so arrange it beforehand)
- during the move, your contents may be already covered if you have contents insurance in place, so it is wise to check with your insurer first. Be aware that if you are not using a professional removals firm and you are moving belongings yourself, then this may not be covered. Damage to valuables e.g. small, high value items may not be covered. Your removals company may also be able to offer insurance.
For further information please contact:
Press & Media Relations Manager – Co‑op Group
Tel: 0161 767 4354 / 07770 441 828
Notes to editors:
* Research carried out by One Poll on behalf of Co-op Insurance with 1,500 first time buyers.
About Co-op Insurance
Co-op Insurance is a UK-based general insurer that operates principally within the personal lines segments of the motor and home insurance markets. Co-op Insurance underwrites the majority of business written, supplemented with some small lines of business where Co-op Insurance acts as a distributor or has a 100% reinsurance arrangement in place.
With more than 1.18m customers, Co-op Insurance is committed to ‘Doing the Right Thing’ and always strives to treat customers and members fairly. Co-op Insurance pioneered the way in lowering the insurance premiums of young drivers as the first major insurer to launch a pay how you drive telematics insurance product for young drivers in 2011. Since launching the scheme, Co-op Insurance has saved its young drivers more than £7.2 million in their first year of driving.