ON the face of it if we decide to go to war with Syria it will have little effect on your home insurance. Unless of course the war provokes major attacks on UK soil and drags the country into a self made recession as funds needed for jobs and industry are diverted to bombs and defence. Then it could well have an impact on your home insurance.
If the Government sees expenditure on the war sky rocket – and at nearly £900,000 per cruise missile used, it has the potential to cost a lot of money – then it will crack down on spending and investment at home as well as bring in more tax levies. All of this is bad for the home economy as nurses, doctors, police and civil servants will be made redundant to save money to go fighting. That adds more burden to the welfare state which itself will be reduced to save money.
Don’t go thinking anything is protected. Witness the Government’s u-turn on tax credits. It can u-turn when it likes on anything and will do so to suit its purposes.
General insurers want stable business and financial conditions and if the war is prolonged or drags down the economy then that will impact on the stock market and forex. The reserves these companies have in those assets will in turn reduce and the big insurers will need to find the income from somewhere and that is likely to be the core business of insurance. Expect car and home insurance to go up in cost.
And taking it a step further, if many people are out of work/struggling then you can expect events such as burglaries and theft to increase. That will increase home insurance by itself.
Then you will need to check your policies for coverage against terrorist attacks. If these become more likely as we are at war with a group that is well known for this sort of activity, then expect more insurers to remove terrorist cover from their home insurance. Then if your property is caught in a terrorist act, it will be you rebuilding it, not the insurer.
I strongly believe that going to war in Syria is David Cameron’s idea of creating a legacy. He hopes it will be a good legacy. I fear it will be a damning one.
War generates some economic gain for certain sectors of the economy – those within defence and material supply. Those small benefits will not outweigh the major disadvantages. And don’t forget the loss of life both at home and abroad that will occur if we are at war. Is the cost of even one innocent life worth it?
Yes, we need to defend ourselves and I think we can. Stop selling weapons to IS. Stop buying oil from them. Bolster our borders and educate our own population on the problems of the region. Ultimately incentivise Syrians to reject violence, don’t kill them and create more martyrs in the future.
Is a war in Syria good for home insurance? Don’t be daft. It isn’t good for anyone.