You wouldn’t sign a contract to purchase a house without looking over it, or buy a car without reviewing the documents before you sign away. Yet according to new research from Compare the Market, 15.1% of people don’t read their policy documents when buying insurance to protect their big investments.*
Compare the Market’s research also found that Gen Z (21.3%) was the generation most likely to never read their Product Disclosure Statements (PDS), followed by Gen X (18.7%). Perhaps even worse, Gen Z and Gen X were the most likely to admit that they didn’t know what an insurance policy document was.
In a surprising twist, the Gen Z cohort had the most people read their PDS cover to cover for all of their insurance products (30.8%).
|Do you read the PDS in full for your insurance products?||% of people||% of Gen Z||% of Millennials||% of Gen X||% of Baby Boomers|
|Yes, I always read it in full for every insurance product I purchase||23.2%||30.8%||22.2%||18.7%||25.7%|
|Yes, I read it in full for some of the insurance products I purchase||15.6%||16.0%||19.9%||12.0%||14.3%|
|I read some of the PDS or policy document, but not all of it||44.5%||29.8%||43.7%||47.5%||47.3%|
|I never read them||15.1%||21.3%||12.9%||18.7%||12.3%|
|I don’t know what a PDS or policy document is||1.6%||2.1%||1.3%||3.1%||0.4%|
Compare the Market’s General Manager of General Insurance, Adrian Taylor, spoke about the perils of not reading your policy documents.
“If people are already spending money on protecting their homes or cars, it’s worth knowing how and what they’re protected for. By not reading the PDS or policy documents that come with the insurance, they may be missing out on vital information relating to what their policy does or does not cover,” Mr Taylor said.
“For example, it may surprise people that in most cases, home and contents doesn’t cover damage caused by termites, birds and other vermin, though some insurers may offer this cover as an optional extra and charge a higher premium.
“Even if people switch from one insurer to another for relatively the same cover, it’s important for them to read through their new policy documents, as these will also vary between insurers.
“While it’s commendable that many Australians at least read some of their PDS, we advise that people read through their full policy disclosure statement for each policy they have. It’s also interesting to see such extremes between Gen Z as some are reading every last word on their insurance documents, while about the same amount never read them.
“By understanding what is covered and the policy exclusions, you may be able to adjust some of your habits to ensure you’re still able to claim on your insurance if the worst happens. For example, you may stop leaving the keys in or near your car at night, which may void possible claims if the vehicle is stolen.
“And if people find that their insurance does not cover their needs, by comparing a number of policies from a variety of providers they may find cover that better matches their needs, and they may also find cover at a better price.”
*Compare the Market surveyed 1,004 Australian adults aged 18 years and over in July 2023.
For interviews and more information, please contact:
Noémi Hadnagy | m: 0433 377 252 | e: [email protected]
Compare the Market s a comparison service that takes the hard work out of shopping around. We make it Simples for Australians to quickly and easily compare and buy insurance, energy, and home loans products from a range of providers. Our easy-to-use comparison tool helps you look for a range of products that may suit your needs and benefit your back pocket.