Marks & Spencer Financial Services is promising to tear up the insurance rulebook with the launch of its streamline household contents policy tomorrow (Friday).

The debut household insurer claims its Home & Contents product will be the only one on the market not to require customers to specify a cover limit for their household contents. Customers will only have to advise it of items worth more than £4,000.

In addition, the policy has only one inner limit – £500 for personal amounts of money. Customers will not have to pay extra for additional items such as bicycles.

A zero excess on the policy means customers will not have to contribute to the cost of any claim, unless they opt to do so for a discount on their premium.

Peter Longstaff, head of personal lines insurance at M&S Financial Services, said the policy, underwritten by Norwich Union, had been designed in response to concerns from insurance customers.

He said: “Policyholders told our researchers that they find it difficult to understand why they are sometimes not paid in full when they have a claim resolved.

“They are also worried about being under-insured and the best way to tackle this is not having a sum insured limit.”

Longstaff, who was previously director of insurance at Axa, said that for claims and underwriting purposes it had used a collection of data based around postal codes, similar to that provided by companies like Experian.

The policy will be targeted at Marks & Spencer's base of six million store card customers and will be available to shoppers at its nationwide network of stores.

Mike Cowburn, spokesman for British Insurance Brokers' Association members in Leeds and north Yorkshire, said brokers would be less impressed.

He dismissed Marks & Spencer's claim that its policy is the first to offer no sum insured limit.

“I have seen all this before. It appears that yet again another direct writer is entering a market place that many others have joined in the past.

“Insurance brokers have learned to live with new competitors and we have survived quite well up to now.”

He qualified this by reasoning that the sort of customer who would buy their insurance from Marks & Spencer will already have their insurance with a direct writer.

Cowburn wondered whether Marks & Spencer's entry into the insurance market was not a ploy to shore up its sliding sales.

“Clearly, Marks & Spencer's retail side is suffering and it appears they have decided to do something to keep up profits.”