Principality Building Society

Principality Building Society

January 18, 2011 11:20 ET

Insure Against the 'Artful Dodger' This New Year

LONDON, UNITED KINGDOM--(Marketwire - Jan. 18, 2011) - Financial worries will be casting a dark cloud over the New Year, with thirty-two percent of people in Wales saying that their biggest financial worry for 2011 is the rising cost of bills.

But, while cutting personal spending may be on the top of most people's New Year's resolution list, Wales' largest building society warns homeowners about the dangers of cutting back on their insurance policies.

According to the Principality Saving and Spending Survey, one in ten people in Wales do not have home insurance and 7% of people in Wales have cancelled an insurance policy in the last 12 months to cut back on their outgoings. Forty-eight per cent of these have admitted to cancelling their contents and buildings insurance.

Barclay Sansom, Insurance Product Manager at Principality Building Society, said: "When household budgets tighten, homeowners wrongly think that home insurance is one payment they can cut back on, but the consequences can be devastating. Buying a house can be the single biggest purchase a person can make and proof that it is protected will be legally required by the mortgage lender."

The survey findings revealed that the average cost of home contents in Wales totalled £41,744. And festive presents will have further pushed up the value of contents.

Barclay continued: "Home insurance is not one of the usual outgoings that can be cut back when times are hard. Rates of property crime are closely tied to growth – when consumption grows quickly, property crime tends to slow and the opposite is true during more uncertain economic periods, where property crime tends to move in step with unemployment rates."

While the unemployment rate in Wales appears to have shown signs of improvement over the last two quarters, following recovery in the UK economy, the country is braced for another wave of significant unemployment distress in the short to medium term.

A look back at unemployment rates in Wales over the last recession reveals the relationship between unemployment and crime. Between 1990 and 1992 the unemployment rate in Wales increased from 6.4% to 9.8% in 1992 and reported crime rates revealed that burglaries in England and Wales increased by 21 per cent over the same period.

Barclay continued: "It is a sad fact that tough times bring out the artful dodger in people – it is important, now more than ever, that homeowners are covered and covered for the right things, to ensure that we all enjoy a safe and relaxing New Year."

Principality Building Society contents insurance covers up to £50,000 as standard and customers receive an additional £1000 of contents cover during December. For more information call into any of Principality's 50 branches throughout Wales and the borders or visit www.principality.co.uk.

Quotations are based on individual properties. Principality insurance cover is underwritten by award-winning insurer, Royal and Sun Alliance Insurance plc.

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