Home emergency cover offered as standard is a very appealing home insurance feature, as per a GlobalData survey. With many households still battling the cost-of-living crisis, paying out of pocket for unexpected home repair costs may be a real struggle. More insurers could bolt home emergency cover as standard and gain a competitive edge.
As per GlobalData’s 2024 Emerging Trends Insurance Consumer Survey, an overwhelming 69.7% of US home insurance policyholders would find it desirable or very desirable to get home emergency cover as standard with their policy. Cover for flood damage is also highly desirable, with 61.4% of respondents viewing this favourably.
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Water damage due to either escape of water or flooding is one of the most common reasons for home insurance claims, explaining the desirability of the aforementioned features. Accidental damage, damage caused by weather events other than flooding, and theft are among the other typical reasons for claims. Having to pay for unexpected expenses such as home repairs, which on top tend to be costly, can pose a real challenge to some consumers. The current economic climate has only worsened the situation. Many households continue to endure financial pressures brought about by the ongoing cost-of-living crisis and are also having to battle with stubbornly high interest rates, which have in turn driven mortgage repayments up.
In fact, nearly half (46%) of US homeowners spent more than $5,000 on unexpected home repairs in 2024, up from 36% in 2023, as per findings from Hippo’s latest Housepower report. According to the study, 42% planned to revisit their home insurance coverage in 2025, with 31% of respondents intending to purchase optional coverage such as flood insurance.
The cost-of-living crisis not only makes it harder for consumers to manage their finances but has also contributed to a rise in the cost of home repairs. Home insurers should bear this in mind when designing their policies. Adding extra features to home policies so these are offered as standard, even if the price of the policy needs to be somewhat higher, could be a viable way to promote sales at a time when consumers are feeling the financial pinch. Insurers that manage to portray to policyholders that they are getting good value for money stand a good chance to gain a competitive edge.
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