“Gold Mine” Homes Face £4.9BN Under-Insurance Risk

16.6 million UK households have never valued their possessions as the value of gold has soared.

UK consumers are at potential risk of leaving their jewellery and other treasures underinsured to the value of some £4.9 billion¹ because the cost of gold has risen by a quarter in the past twelve months, warns a leading specialist insurance provider.

The RIAS ‘Golden Age’ study reveals that there are over 112 million items of gold in homes across Britain, with an average total value of £1,189 per household – meaning that the total value of gold jewellery and other items owned by UK consumers stands at £19.7 billion ².

However, almost two thirds (61%) of these gold owners³ have never had any of their gold items valued. This means that millions of consumers could be left under-insured to the tune of £297 per household¹, and therefore out of pocket. This equates to an under-insurance risk of £4.9 billion¹ across Great Britain.

As millions of consumers’ home contents insurance policies could be out of date, policyholders may be in danger of receiving substantially less than they should for their ‘high-risk’ items if they suffer theft, loss or damage. For many, this means that should the worst happen, they will not be able to replace their valuables.

‘Golden oldies’
The online study highlights over 50s as particularly at risk from this “under-insurance trap”.

Over 50s tend to own more gold items than the average UK household (with eight items of gold per household, compared with six items in under 50s households). Furthermore, the value of over 50s’ gold tends to be higher, averaging £1,313 in total per household, compared with their under 50s counterparts, whose gold averages at £1,085. However, the RIAS research found that more than half (55%) of over 50s who own gold have failed to have any gold items valued since they were originally purchased, and that almost all (93%) have not had their items revalued in the last two years, as is generally recommended.

The ‘Golden Age’ study also found that seven out of ten (71%) over 50s do not have any of their gold items specified as ‘high-risk’ on their insurance policy, meaning they could be subject to single item limits which could be lower than their true value.

Despite the price of gold rising by a quarter (25%) to £709 per ounce in January 20104, just 11% of consumers are aware that the market value of gold has increased by up to one quarter, which may explain why some have not informed their insurance provider.

Janet Connor, Managing Director at RIAS, comments:
“Many people over 50 have accumulated a significant number of gold possessions, which may hold both emotional and financial value. With the value of gold significantly increasing over the past 12 months, all consumers would be wise to ensure that all their ‘high-risk’ items are regularly revalued, to avoid any nasty surprises if they did have to make a claim on their  household contents insurance.

“The most an insurer will pay for any high-risk item is the sum the customer has insured it for, as reflected in their policy schedule. By reviewing the value of individual items every two years, and updating policies as necessary, consumers can eliminate the risk of being under or over-insured.”

No cashing in for consumers
Despite the current economic climate, eight out of ten (81%) over 50s gold owners are not planning on parting with their gold in the near future. Less than one in ten (9%) over 50s are planning on using their entrepreneurial spirit to cash in their gold items over the next few months.

Matt Graydon from The World Gold Council observed:
"Last year the gold price rose 25% in value, while almost all other assets headed in the other direction. Gold's wealth preservation characteristics have become centre stage during this period of economic turmoil but remain important to investors during any period of time.

"Due to its enduring value gold remains a sound investment for future family heirlooms. If you already own some gold items you may be surprised at a how much they are worth and so it’s worth looking into a valuation sooner rather than later.”

For further information, please contact:
Jo Carr, Alex Kennedy or Laura Johnston at Seventy Seven PR on 020 7492 0977 or email rias@77pr.co.uk
Alternatively, contact Lucy Pope, Consumer Communications Manager on 01202 254445 or 07500 665791, or email lucy.pope@fortis-uk.com. Blair Catchpole, Consumer Communications Executive on 01202 254489 or email blair.catchpole@fortis-uk.com

Notes to Editors
Unless otherwise specified, all figures are from YouGov research, undertaken between 22 – 24 December 2009 online. Total sample size was 2,432 adults, including 1,130 over 50s.

Figures at a glance Items of gold items in homes across Britain	Over 112 million
Average value of each household's gold items	£1,189
Total value of gold items owned by age	Over 50s £1,313 Under 50s £1,085
Percentage of people who own gold in UK who have never had their gold valued	61%
Percentage of over 50s who own gold who have never had any of their gold items valued	55%
Percentage of over 50s who own gold who have not had their gold items revalued in the last two years (recommended by insurers)	93%
Percentage of over 50s who do not have any of their gold items listed as 'high risk' on their insurance policy	71%
Amount that people who have not had their gold valued recently could be under-insured by (per household)	£297
Amount that people who have not had their gold valued recently could be under-insured by (total across Great Britain)	£4.9 billion
Percentage increase in the price of gold during 2009	25%
Percentage of gold owners who are not planning on selling any of their gold in the near future	81%

¹ Calculations made by Seventy Seven PR using YouGov results. The research shows that 66% of UK consumers own at least one gold item, equivalent to 16.6m households (there are 25.2m households in Great Britain, source: ONS, 2009). The average number of gold items (6.8) multiplied by ‘gold owning’ households comes to a total of 112.9m items, with an average value of £1,189. As the price of gold has increased by approximately 25% over the last 12 months, consumers could be underinsuring the overall value of their gold items by an average of £297, which equates to an overall financial risk of £4.9bn.
² Calculations made by Seventy Seven PR using YouGov results. The average value per item of gold is £175, with a total value per household of £1,189, based on 6.8 items. This equates to an overall value of £19.7bn across Great Britain.
³ ‘Gold owners’ are defined Gold owners’ are defined as consumers who own at least one real gold item that is kept at home.
⁴ The price of gold per ounce has increased from £557/oz in January 2009, to £696/oz in January 2010, a 25% increase (Source: goldprice.org, 2010).

About RIAS
RIAS was established in 1992 and is a specialist provider of insurance products for the over 50s age group.

Part of Fortis (Insurance UK), RIAS has a million motor, home and travel insurance customers, employs over 1,100 people across two UK sites, and is one of the UK’s fastest organically growing insurance intermediaries. RIAS negotiates with a panel of insurers to secure competitive, value for money products.

As a leading provider of award-winning personal and commercial lines insurance solutions in the UK, Fortis has a successful customer-centric strategy, founded on aligning its activities to how customers want to buy insurance, combined with delivering high quality products, manufactured at costs better than market norms.

Insuring in excess of 7 million customers and working with a range of partners, Fortis is recognised for delivering consistent and high-quality customer experiences. In 2008, its non-life profit before tax and interest was £76 million and its non-life GWP was £760 million.