Home renovations and second homes see big rise through 2020
Since lockdown first began we’ve seen a rise in the number of people wanting to renovate their homes or buy a weekend retreat in the UK. Many insurers can’t or won’t sell these sorts of policies online so this week we’ve trained our automated underwriting process to cater for this demand.
For most of us, the past few months have meant spending a lot more time at home. Living and working in the same place for a long time is starting to make us all pay attention to our homes and how they could be better.
For some of us it’s time to get that extra bedroom, find a place with a garden, or sort out the avocado coloured bathroom suite that’s been bothering us for years.
That trend is becoming clear in our policy data, as renovations are ramping up. In fact we saw demand for renovations double over the summer and 15% up on last year. This is particular notable as traditionally we’d expect to see new renovations slowing down as the weather turns.
We’re also hearing more people say they will be undertaking this renovation work themselves, sometimes due to flexible working arrangements, being on furlough, or perhaps less income security to commit to paying professional tradesman.
The stamp duty freeze is another factor behind this trend, which has encouraged some to snap up a second home away from the cities. We’ve seen the number of people insuring second homes snap up by over 50% in 2020.
For many insurers, these sorts of trends can pose a problem. As soon as a customer indicates they intend to renovate or that their home may be classified as being in ‘a poor state of repair’, their case is handed off to an underwriter to investigate. Shopping around takes longer and premiums can soar.
At Avantia we’re lucky to run our own technology stack. This tech drives our automated underwriting process, amongst other things. At the core of things is our decisioning platform – a place where we can train solutions to watch, learn and make intelligent decisions about anything which happens on customer’s policy.
At the end of October our ratings team pushed a significant update to help adapt to the trends we’re seeing. This means:
- All of the most popular forms of home renovation can all now be assessed and underwritten instantly online
- Much improved analysis and coverage for homes classified as in a “poor state of repair”, including second homes and those awaiting building work
- Greater automated analysis and support for customers who choose to do the renovation work themselves
Our vision is to deliver the world’s most intelligent property insurance and this week’s release is another step on that journey.