Investigating General Insurance Add-ons

Investigating General Insurance Add-ons


This brief looks at take-up of add-on cover in the home and car insurance markets, examining the level of consumer understanding regarding the extra cover they have purchased and whether they have claimed. It considers whether or not the FCA is correct to be concerned, and explores the issues that need to be addressed.


  • Identify demand for add-on products in home and car insurance.
  • Understand the issues the FCA has with the sale of add-on products.
Reasons To Buy
  • Do consumers buying home and car insurance understand the extra cover they are buying?
  • Is the FCA right to be concerned about the sale of add-on insurance products?
Key Highlights

The high percentage of consumers adding extra cover to their car and home contents policies highlights that for the majority of consumers the basic policy does not meet their insurance needs.

Overall the perceived understanding of add-on cover is much higher within the car insurance market, where a large proportion of policy owners know what they are buying.

  • Executive Summary
    • The FCA is concerned that add-on policies are of little value to consumers
    • The FCA is right to be concerned
    • Critical success factors
  • The FCA is Concerned About the Use of Add-On Policies
    • Introduction
      • The FCA is concerned that add-on policies are of little value to consumers
    • Add-on product take-up is high in the home and motor spaces
      • The majority of consumers are adding to their cover
      • Accidental damage is the top add-on for home products
      • Legal expenses is the number one add-on for car insurance
    • Insurance providers need to do more to explain extra cover
      • More understanding exists within the home combined space than for contents and buildings policies
    • Have they claimed on their extra cover?
      • Legal expense claims are low for home insurance
      • Low levels of claims for motor legal expenses and key care will concern the FCA
  • The FCA is Right to be Concerned
    • Insurance providers need to do more for their customers
      • Table Estimated number of licensed cars with extra cover, and who have claimed
      • The FCA wants more information within the sales process and an end to opt-out
      • Worry+Peace is a good example of providing clarity
      • The opportunity exists for insurers to allow consumers to shape their own products
      • Some covers need to be prioritized for change
  • Appendix
    • Abbreviations and acronyms
    • Methodology
      • Verdict Financial's 2014 General Insurance Consumer Survey
    • Bibliography
    • Further reading

Download our eBook: How to Succeed Using Market Research

Learn how to effectively navigate the market research process to help guide your organization on the journey to success.

Download eBook