Low-cost Insurance Schemes in Scottish Social Housing: An Empirical Study of Availability and Tenants' Participation

The UK has had a long history of market provision of household insurance. Recent years, however, have seen a decline in the traditional insurance market distribution channels aimed at low-income and/or rented-sector households. The products, pricing and method of payment currently offered by insurers have exacerbated the exclusion of many in social housing from this important financial services product. Research suggests that only 50 per cent of people living in rented or local authority housing insure their contents, compared with 93 per cent of homeowners. The aim of this paper is to evaluate the degree to which tenants in public-sector housing participate in low-cost household insurance schemes promoted by their landlord and to assess the reasons behind this level of participation. This study suggests that, despite value-for-money schemes being available, the take-up rates by tenants are low and that the providers of social housing need to be more vigorous and imaginative in their promotion of low-cost insurance schemes if this form of financial exclusion is to be tackled successfully.