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UK Consumers and Gagdet Insurance Market Report

Everything you need to make the right decisions

Providing the most comprehensive and up-to-date information and analysis of the Consumers and Gagdet Insurance market, and the behaviours, preferences and habits of the consumer.

Mintel has the answers you’re looking for

What are the key challenges facing the industry? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?

Covered in this report

For the purposes of this report, Mintel has used the following definitions:

Gadget insurance is a general insurance product that covers gadgets against at least one of the following risks: loss, theft, accidental damage and breakdown. A gadget is defined as a valuable and portable electronic device. Therefore, gadget insurance policies cover such items as smartphones, laptops, tablets, portable/handheld games consoles, digital cameras, camcorders, smartwatches, high-end headphones/earphones (with a retail price of at least £200) and other portable and valuable gadgets over £200 in value (eg Virtual Reality set, portable speakers).

Aside from specific gadget insurance from specialised insurers, cover may be included under home contents insurance, or can be acquired as an add-on. Policies that protect gadgets to a varying degree can be arranged with the manufacturer, the retailer the gadget is bought from, via a mobile network operator, or received as a perk with financial products such as packaged current accounts.

Expert analysis from a specialist in the field

Written by Irene Salazar, a leading analyst in the Financial Services sector, her extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

People want to keep their devices for longer and are keen to protect them. Gadget insurance has a strong case in a world of expensive, indispensable technology and sustainable-minded consumers. Simple, relevant products that provide clear value appeal to owners, but insurers also need to find a spot at the all-important moment of purchase. Irene Salazar
Financial Services Analyst

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Table of contents

  1. Overview

    • What you need to know
      • Products covered in this Report
      • Executive Summary

          • The market
            • ‘On the go’ internet use becomes the norm
              • Figure 1: Using the internet ‘on the go’, by age, 2013-18
            • Intentions to buy remain robust
              • Figure 2: Technology products: recent ownership and intentions to buy, June 2018
            • The average household owns possessions worth £35,000
              • GDPR and Open Banking come into force
                • FCA considers ban on sale of extended warranties alongside rent-to-own agreements
                  • Companies and brands
                    • Standalone gadget insurers want to stand out from the crowd
                      • Alternative distribution channels: mobile network operators
                        • Launch activity and innovation
                          • First dedicated gadget insurance comparison site launched
                            • Challengers incorporate insurance into app-only banking proposition
                              • The consumer
                                • 36% of Millennials have four or more types of gadgets
                                  • Figure 3: Ownership of gadgets, September 2018
                                • Home insurance is the most common way of insuring gadgets
                                  • Figure 4: Penetration of gadget insurance, by type of gadget, September 2018
                                  • Figure 5: Penetration of gadget insurance, by type of coverage and gadget, September 2018
                                • Increasing cost of gadgets is powerful argument in favour of insurance
                                  • Figure 6: Reasons for not having gadget insurance, September 2018
                                • People want to keep their gadgets for longer and want to protect them
                                  • Figure 7: Attitudes towards gadgets, September 2018
                                • Time of gadget purchase is crucial for insurance sales
                                  • Figure 8: Gadget risk exposure, September 2018
                                • Consumers want simplicity but there is room for personalisation
                                  • Figure 9: Attitudes towards gadget insurance, September 2018
                                • What we think
                                • Issues and Insights

                                  • Extended warranties: right place, right time
                                    • The facts
                                      • The implications
                                        • Keeping gadgets for longer: insurance and the sustainability angle
                                          • The facts
                                            • The implications
                                            • The Market – What You Need to Know

                                              • ‘On the go’ internet use becomes the norm
                                                • Average possessions worth £35,000 but many are uninsured
                                                  • Competitor Products – Wide Choice But Clear Differences
                                                    • Home contents
                                                      • Extended warranties
                                                        • Financial products
                                                          • GDPR and Open Banking come into force
                                                            • FCA considers ban on sale of extended warranties alongside rent-to-own agreements
                                                            • Market Drivers

                                                              • Majority of people use the internet ‘on the go’
                                                                • Figure 10: Using the internet ‘on the go’, by age, 2013-18
                                                              • Preferred devices give an indication of the scope for gadget insurance
                                                                • Figure 11: Using the internet ‘on the go’, by device and age, 2018
                                                              • Intentions to buy remain robust
                                                                  • Figure 12: Technology products: recent ownership and intentions to buy, June 2018
                                                                • The average household owns possessions worth £35,000
                                                                  • 81% of ‘Generation Rent’ without contents cover
                                                                  • Competitor Products

                                                                      • Home contents
                                                                        • Extended warranties
                                                                          • Financial products
                                                                          • Regulatory and Legislative Changes

                                                                            • FCA looks to measure value of add-ons
                                                                              • GDPR and Open Banking come into force
                                                                                • FCA considers ban on sale of extended warranties alongside rent-to-own agreements
                                                                                • Companies and Brands – What You Need to Know

                                                                                  • Competitive strategies
                                                                                    • Standalone gadget insurers want to stand out from the crowd
                                                                                      • Alternative distribution channels: mobile network operators
                                                                                        • Launch activity and innovation
                                                                                          • First dedicated gadget insurance comparison site launched
                                                                                            • Challengers incorporate insurance into app-only banking proposition
                                                                                            • Competitive Strategies

                                                                                              • ZugarZnap’s Millennial proposition
                                                                                                • Alternative distribution channels: mobile network operators
                                                                                                  • Social media campaigns
                                                                                                    • Cashback sites
                                                                                                    • Case study – Trōv’s On-demand Insurance

                                                                                                        • Insure whatever you love…
                                                                                                          • …whenever you need it…
                                                                                                            • …directly from your phone
                                                                                                              • Figure 13: Trōv’s user interface
                                                                                                            • Dynamic price adjustment
                                                                                                            • Launch Activity and Innovation

                                                                                                              • First dedicated gadget insurance comparison site launched
                                                                                                                • Starling Bank’s in-app marketplace offering so-sure smartphone insurance
                                                                                                                  • Revolut partners with Simplesurance to offer entirely digital mobile phone insurance
                                                                                                                  • The Consumer – What You Need to Know

                                                                                                                    • 36% of Millennials have four or more types of gadgets
                                                                                                                      • Home insurance is the most common way of insuring gadgets
                                                                                                                        • Increasing cost of gadgets is powerful argument in favour of insurance
                                                                                                                          • People want to keep their devices for longer and take steps to protect them
                                                                                                                            • Time of gadget purchase is crucial for insurance sales
                                                                                                                              • Parents are a key demographic
                                                                                                                              • Ownership of Gadgets

                                                                                                                                • Gadget ownership is almost universal among adults
                                                                                                                                  • Figure 14: Ownership of gadgets, September 2018
                                                                                                                                • 36% of Millennials have four or more types of gadgets
                                                                                                                                  • Figure 15: Repertoire of gadgets owned, by generation, September 2018
                                                                                                                              • Penetration of Gadget Insurance

                                                                                                                                • 43% of smartphone owners have insurance
                                                                                                                                  • Figure 16: Penetration of gadget insurance, by type of gadget, September 2018
                                                                                                                                • Gadget insurance is a minority option…
                                                                                                                                  • …but increases among more regularly used products
                                                                                                                                    • Figure 17: Penetration of gadget insurance, by type of coverage and gadget, September 2018
                                                                                                                                • Reasons for Not Having Gadget Insurance

                                                                                                                                  • Increasing cost of gadgets is powerful argument in favour of insurance
                                                                                                                                    • Figure 18: Reasons for not having gadget insurance, September 2018
                                                                                                                                  • Uninsured owners tend to have one main reason for not buying a policy
                                                                                                                                    • Figure 19: Repertoire of reasons for having uninsured gadgets, September 2018
                                                                                                                                • Attitudes towards Gadgets

                                                                                                                                  • Two thirds claim to always take precautions with their devices
                                                                                                                                    • People are aware they could do more
                                                                                                                                      • Figure 20: Attitudes towards gadgets, September 2018
                                                                                                                                    • Finding potential customers among those who have broken a gadget
                                                                                                                                      • Figure 21: Consumers and gadget insurance – CHAID – Tree output, September 2018
                                                                                                                                  • Gadget Risk Exposure

                                                                                                                                    • Worldwide cover is key
                                                                                                                                      • Good timing is essential for sales
                                                                                                                                        • Figure 22: Gadget risk exposure, September 2018
                                                                                                                                      • Owners of uninsured gadgets are less concerned
                                                                                                                                        • Figure 23: Gadget risk exposure, by type of coverage, September 2018
                                                                                                                                    • Attitudes towards Gadget Insurance

                                                                                                                                      • Consumers want simplicity…
                                                                                                                                        • …but there is room for personalisation
                                                                                                                                          • Figure 24: Attitudes towards gadget insurance, September 2018
                                                                                                                                        • Existing policyholders more open to innovative options
                                                                                                                                          • Figure 25: Agreement with attitudes towards gadget insurance, by type of coverage, September 2018
                                                                                                                                        • Capturing parents’ attention
                                                                                                                                          • Figure 26: Agreement with attitudes towards gadget insurance, parents^ vs non-parents, September 2018
                                                                                                                                      • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                          • Abbreviations
                                                                                                                                            • Consumer research methodology
                                                                                                                                              • CHAID Analysis Methodology