Home insurance claims can be rejected up to 23% of the time, worrying new figures reveal.
This insurance bundles up buildings cover for the property itself and contents cover for the items within it.
Buildings cover is a legal requirement for anyone with a mortgage, while contents insurance gives peace of mind to renters and homeowners.
But figures from the Financial Conduct Authority (FCA) show that 23% of home insurance claims are not accepted and paid out - compared to about 1% for car insurance.
The bombshell findings are the first time the FCA has published data on how insurers pay claims - crucial information for consumers.
Some home insurers only pay out between 55% and 60% of the claims they get, including Ageas Insurance, QIC Europe and Qmetric Group.
Others pay out 60% to 65%, such as AA Underwriting Insurance Company and Lloyds Bank General Insurance.
But many other insurers pay out up to 100% of home insurance claims, such as Haven Insurance Company.
Michael Sicsic, managing partner of Sicsic Advisory and a former FCA insurance boss, said: "Clearly home insurance acceptance rates are among the lowest, especially compared with areas like motor insurance."
The regulator wants the stats to tackle what it calls "ineffective competition between providers of insurance products".
The FCA's data looked at claims from July to December 2021.
But there is more to the claims figures than meets the eye.
If an insurer reports that it turns down 55% of claims, some of that will be outright rejections.
But these stats also include people who ask their insurer if something is covered, but never make a claim - known as 'claims walkout'.
This suggests insurance customers may not always fully understand what they have bought.
Sicsic added: "Either some consumers are not clear what they are buying or the insurer is not making it clear what is and is not covered.
"But the business model of insurers is still to pay claims, not reject them."
An Ageas spokesperson said: "“We track the performance of our household product, including the policy cover and claims acceptance rates, on an ongoing basis and will use the data from the FCA General insurance value measures as one of the inputs to this process. "
A spokesperson for Qmetric said: "We are proud of the customer-focused service we deliver and carefully monitor satisfaction and renewal rates, which both compare well to industry averages, as well as acting on feedback to continually improve the customer experience."
A spokesman for AA Insurance said the figures also hide the fact that insurers vary in how they report claims to the FCA.
The spokesman said: “The AA Underwriting Insurance Company will always accept and pay claims where the customer is covered, and our acceptance levels aligns with larger home insurers.
“We do not believe that these figures provide a meaningful comparison for claims acceptance for several reasons, but predominantly because insurers appear to interpret the FCA definitions for claims acceptance differently.”
Lloyds would not comment. QIC Europe has been approached for comment.
