One in five households are without home contents insurance, according to a national survey supported by the Joseph Rowntree Foundation. Theseincluded a high proportion of those most likely to need such insurance.

It found that uninsured households were disproportionately likely tohave low incomes, few savings and to be facing financial difficulties.Most were tenants living in disadvantaged urban neighbourhoods where therisks of burglary meant that insurance premiums were higher thanelsewhere.

Researchers at the Policy Studies Institute and Institute for PublicPolicy Research found about half those who were living in uninsuredhouseholds had held home contents policies in the past, but had let themlapse usually because of money problems. The remaining half tended to bepeople living on very low incomes with no bank account and littlecontact with companies selling financial services.

Most of those interviewed were aware of the potential problems theyfaced through having no insurance, especially the risks of burglary. Onein seven had actually lost possessions through theft, fire or flood andeither been unable to replace them, or else compelled to borrow withintheir families or from the Social Fund.

The research, which included case studies of insurance companies andbrokers, found the industry's claim that the great majority ofhouseholds could get access to home contents insurance was generallyjustified. Relatively few low-income households had ever been refusedinsurance outright.

However, it was evident that mainstream insurance products were ofteninappropriate for people on low incomes. Conditions attached topolicies such as high minimum sums insured and 'excess' payments to bemet by the householder served as a deterrent for those with little cashto spare.

Even so a number of insurance companies were specifically targetinglow-income households by working in commercial partnership withintermediaries, including local authorities, housing associations,credit unions and charities for the elderly. Just under half all localauthorities and one in five housing associations were offering homeinsurance schemes designed for their tenants.

Claire Whyley, co-author of the report, said:

"More can be done by theinsurance industry and social landlords to ensure that of the one infive households who are currently uninsured, a significant proportionare offered affordable and appropriate home contents insurance. Theentry of local authorities, housing associations and other intermediary'gatekeepers' into the insurance market has already widened access tohome contents insurance for many households who would not otherwise havebeen able to obtain it."

1. Paying for Peace of Mind: access to home contents insurance for low-income households by Claire Whyley, James McCormick and Elaine Kempson is published by the Policy Studies Institute and available from Grantham Book Services, Isaac Newton Way, Alma Park Industrial Estate, Grantham, Lincs. NG31 9SD (01476 541080), price £14.95 (plus £2.50 p&p).

2. A summary of findings can be obtained free of charge from JRF, The Homestead, 40 Water End, York YO3 6LP (01904 629241) or from the Foundation's web site.

3. PSI is a registered educational charity (no 313819) and has no association with any political party, pressure group or commercial interest.