Misrepresentation, Non-Disclosure and Breach ... - Law Commission

Section 4 Baseline analysis of insurance markets and the extent of non-disclosure
Table 7: Annualised expenditure on insurance products
Number of
households
Covered
Average
annual
expenditure
for
households
covered
Total annual
household
expenditure
(£m)
Buildings Insurance 1 15.6m £200 £3,120
Contents Insurance 2 18.6m £166 £3,088
Net written
premium
2005 (£m)
(ABI)
£5,840 8
Medical Insurance 2.9m £699 7 £2,027 £1,470 8
Vehicle Insurance 3 17.8m £536 £9,541 £11,902
Mortgage Protection 4 5.0m £434 £2,170 £526
Life Insurance 9.8m £765 £7,497 £36,313 9
‘Other’ Insurance 6.1m £255 £1,556
Accident and Health £5,009
General Liability £4,640
Pecuniary Loss £4,378
Critical Illness 5 0. 511m £240 £123 11
Income Protection 6 0.130m £469 10 £61
Total 24.8m
1,2 14% of policies sold are buildings insurance only, 32% are home contents only and 54% relate to
buildings and contents insurance (FSA, 2007). CRA (2006) indicate that there are approximately 16.7m
individual home insurance policies in force.
3 There are approximately 27 million vehicle insurance policies in the UK: 90% are comprehensive, 9% are
Third Party Fire and Theft and 1% are Third Party only. CRA (2006) indicate that there are approximately
24.8m individual motor policies in force.
4 CRA (2006) indicate that there are approximately 1.78 million private healthcare policies in force.
5 GE Insurance Solutions estimate that approximately 511,000 individual critical illness policies were sold
in 2005 – quoted in Norwich Union (2005).
6 CRA (2006) indicate that there are approximately 130,000 individual income protection policies in force.
7 CRA (2006) indicate that the average premium for private medical insurance was approximately £826 per
annum
8 CRA (2006)
9 Life includes Ordinary Branch business, Savings and Protection products, i.e. Bonds, Endowments,
Whole of Life, Term Assurance and Collective Life.
10 Derived from CRA (2006)
11 LE calculation
London Economics
June 2007 19