Study reveals common insurance blind spots

Study reveals common insurance blind spots | Insurance Business America

Study reveals common insurance blind spots

A new survey commissioned by The Hanover Insurance Group has revealed some common insurance blind spots among US customers.

The survey, commissioned in recognition of National Insurance Awareness Day, analyzed how the COVID-19 pandemic has changed Americans’ lives and whether they have made the adjustments necessary to maintain effective insurance coverage. The survey, which polled 2,000 adults, was conducted by OnePoll on behalf of The Hanover.

The study found that seven in 10 respondents made significant changed in their lives over the last year. For instance, 18% adopted a pet, while 13% renovated their home. The changes revealed some common insurance blind spots, the Hanover said.

Top insurance blind spots

  • 68% of respondents did not know that making changes to their homes and yards – such as adding pools or trampolines – or adding pets could mean they needed to make changes to their homeowners' policies
  • 77% did not know that homes above a certain price point may need special insurance coverages
  • 75% did not know umbrella insurance could help protect them from financial loss if they were sued
  • Nearly 70% were unaware that their home’s market value – the price to sell – was not the same as its replacement value – the price to rebuild
  • 34% were unsure about what their policies covered
  • 30% felt they had insurance blind spots because they did not know what insurance coverage they needed

Read next: The Hanover reveals Q1 catastrophe losses

Many consumers started home renovations during the pandemic. Many of the top projects cited, like remodeling a kitchen or bathroom, adding a work-from-home space, or replacing roofs or siding, can have direct insurance implications. However, 63% of respondents said they didn’t know their homeowners' policy needed to be reviewed or updated when they made renovations.

“With all the home improvement projects undertaken during the pandemic, it’s important to make sure insurance policies reflect these changes,” said Daniel Halsey, president of personal lines at The Hanover. “Our results showed the majority of respondents agreed it would be helpful to have their coverage reviewed by an insurance expert. Independent agents are experienced, professional resources for consumers who want to ensure they have the appropriate insurance coverages in place to protect these investments.”