The steady stream of demutualisations has slowed to a trickle and there is now a very small field of mutuals and building societies from which to choose insurance products. The Research Department analyses buildings, contents and private car products to see how they perform in their respective markets

Buildings cover
The insurance product most associated with mutuals is buildings insurance, traditionally allied to a mortgage. Where companies offered more than one buildings product we looked at the one offering the best level of cover.

None of the mutual products was best in the market - that position is held by Bluesure. There is little overall diversity in the buildings insurance market, and most mutuals offer acceptable levels of cover.

After Bluesure, the West Bromwich Building Society offers the best level of cover among the panel analysed. Key features include:

  • Buildings sums insured index-linked
  • Cover includes damage to heating and water installations by freezing
  • Alternative accommodation up to £15,000
  • 60-day unoccupancy period
  • £50 standard excess, £1,000 subsidence excess.

    Areas where the West Bromwich lags behind include:

  • No legal expenses cover option
  • No no claims discount available
  • £1m public liability cover, when some in market offer £2m or more.

    Contents cover
    When we look at contents products there is much more diversity in the cover on offer, compared to buildings policies.

    However, market leader Marks & Spencer significantly outstrips the mutual providers, with only NFU Mutual coming close.

    The others form a trailing pack offering similar levels of cover.

    Key features of the NFU Mutual product include:

  • Index-linking of sums insured
  • Valuables single item limit of £5,000
  • Lock replacement following loss of keys without limit
  • Loss of metered water covered up to £2,500
  • Unlimited freezer cover
  • 10% seasonal increase in sums insured at Christmas and weddings
  • £10,000 fatal injury benefit
  • No excess as standard (£25 for accidental damage claims)
  • Handling fee for payment by direct debit just 1.5%.

    Private car policies
    Unsurprisingly there are considerably fewer private car policies available from the mutuals, since most of the remaining building societies are too small to offer these products. However, for comprehensive motor insurance NFU Mutual is a clear market leader.

    Other mutuals like CIS, Royal London and Nationwide offer products that appear to fit in well with what is probably their target audience - mid-market in terms of both cover and price.

    For comparison we have included a small number of policies available in the broker market. Key features of the NFU Mutual policy include:

  • New car replacement for cars up to two years old
  • Unlimited cover for manufacturer fitted audio equipment, otherwise £500
  • £250 of personal belongings cover
  • Cover for lock replacement following loss or theft of keys, up to market value of the vehicle
  • £15,000 death and £5,000 disability personal accident benefits
  • Cover for attached trailers up to £1,000
  • Unlimited foreign use at no extra charge
  • Free breakdown and accident recovery
  • £25 windscreen replacement excess (£40 if recommended repairer not used)
  • Direct debit fee of just 2%.

    The only area in which NFU Mutual cover is not market leading is in the provision of a courtesy car in the event of a total loss claim.

    A number of other insurers do offer a courtesy car for at least a few days in these circumstances.

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