People have a lot more to spend on goods and services. The income of the average family in the United Sates is three times the cost of basic living. This means that about two thirds of family income is discretionary. People spend this discretionary income in two areas. They also spend more on non-essentials, ranging from pedestrian items like radios and television sets to more luxury items like snowmobiles and jet skis.
Insurers can take advantage of the growing amount of discretionary income in two main ways.
For example, homeowners could be provided with a free video inventory service once a year. The free video service would help these customers, and at the same time provide opportunities to expand insurance sales. The second area to consider is the sale of insurance to cover the increased products that consumers purchase with their discretionary income. Depending on their horsepower, watercraft may not be covered for liability under the homeowners policy. There are other limitations of cover under the standard homeowners policy for luxury items like jewelry, furs and silverware, and there are restrictions on cover for computers and home entertainment systems.