The UK is becoming a country of renters rather than home-owners according to a recent government whitepaper. The proportion of people living in the private rented sector has doubled since 2000 and just 26% of those aged 20-39 will own their own home by 2025. According to the Resolution Foundation, twenty five years ago fewer than one in ten families rented their home from a private landlord – but now it is almost one in five. These are turbulent times for the housing market and especially this young generation.
What does this mean for the insurance industry?
With more people expecting to live longer in rented accommodation, how is this changing the insurance industry, and how should the market respond to a new generation of customers? These were the questions I wanted to explore when I recently organised a survey of young British adults from Generation Rent.
The results are disconcerting for the industry. Generation Rent typically does not have any contents insurance at all. 60% of young renters aged 20-30 have no insurance, despite a majority saying they had suffered a loss while uninsured (55%). Notably, in countries where renting is more common, the reverse is true; in a parallel survey I commissioned, 66% of Germans of the same age group do have contents insurance.
To learn more about why Generation Rent is hesitant to purchase insurance and how insurers can succeed in attracting and holding onto this significant new customer base now and in the future, please read my Finextra article, as well as our press release earlier this week.