Third 'don't read insurance policy'
Updated on 03 April 2007
A third of consumers do not read their insurance policies - leaving them at a loss over what is covered by the contract, according to a report by Norwich Union.
Research of around 1,000 UK adults found that just under 40% of people who have taken out insurance are unclear what their policy covers, with 33% not bothering to study the relevant documents.
In addition, 38% of people do not know when their contract expires despite the implications that remaining uninsured could have.
Darren Cornish, head of customer experience at Norwich Union, said: "Our research highlights a lack of understanding about insurance.
"Customers who do not know what they are covered for could face disappointment when claiming if their expectations are not met - something which could be avoided if they understood what is in their policy before they need to claim.
The Your Policy Uncovered report revealed a number of misconceptions over what common insurance policies cover.
More than a third of motorists believe that if the keys are left in the ignition and their car is stolen, they will be automatically covered.
And only one in ten is aware that adding a partner to their car insurance could result in lower premiums.
A fifth of homeowners mistakenly believe that if their home was completely destroyed, their buildings cover would pay the full market value of their home.
Mr Cornish said: "The insurance industry has a responsibility to be open and transparent about the workings of its policies, and we want to help cut through any confusion so people understand exactly what they are - and are not - covered for. However, customers have an equal responsibility to read the information we send them. We really encourage them to ask questions of their insurer if they are unclear on anything."
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