Don't forget to look in the wardrobe when valuing your home contents
It's not just the furniture and expensive gadgets that need to be included on insurance policies, warns Chiara Cavaglieri
Sunday 20 September 2009
With household budgets overstretched, scrimping on insurance may be tempting, but having inadequate cover means you could be caught short if the worst happens. One of the most common mistakes is to underinsure household contents. Insurers recommend regular evaluations of home contents, about once every six months. The value of all your contents, new and old, may come as a bit of a shock if you haven't checked for some time.
"Being underinsured for home contents is an easy mistake to make. Many people underestimate the value of their belongings and only realise their true value once it's too late," says Debra Williams from Tescocompare.com.
When assessing how much cover you need, draw up a list of rooms and the items inside each room. It's not just about furniture; curtains, carpets, ornaments and bedding are often overlooked and can add up to a considerable amount if they had to be replaced. Create an inventory of items, including collections of cheaper items such as books and films, and update it as often as you can. Clothing is another item often forgotten, so include the cost of replacing the entire wardrobe. That old suit may not look like much, but it could leave dent in your wallet if you had to replace it.
Check the upper limit on valuables such as jewellery and take out separate cover if your items fall outside this limit. Remember that when precious metal prices rise it will affect the cost of replacing any relevant pieces you own. During the recession, for instance, the price of gold has reached record levels, meaning that many people own jewellery that is now being severely undersold on their policy.
Newlyweds are particularly at risk if they fail to tell their insurer about new belongings after their big day. The average increase in value following a wedding is nearly £12,000, according to a new study by specialist insurer Hiscox. Despite this, Hiscox said, more than half of couples married in the past five years have not reviewed their cover or informed their insurers about the boost in contents. Few couples have anything other than dress fittings and seating plans on their mind before a wedding, but cover for loss or theft of gifts and rings is important. "The accumulated value of these items can be huge, so it's worth having a quick look at your contents policy to see if your insurer includes immediate cover for new items," says Austyn Tusler, a household insurance expert at Hiscox.
The run-up to Christmas, which seems to get earlier each year, is another vulnerable time with expensive gifts presenting an easy target for burglars. Always check that your existing policy offers extra cover for the total cost of any stolen Christmas gifts, particularly if you've forked out for an expensive piece of art or jewellery. There are many variations between policies so check the small print carefully to see where you stand. As an example, if you have £45,000 worth of contents but insurance for only £30,000, some insurers may pay only two-thirds of a claim, even if it is for less than £30,000.
"Having to spend hard-earned cash to top up an insurance pay-out is an unnecessary headache, especially as it takes only one phone call to increase your cover," says Julie Owens, the head of home insurance at Moneysupermarket.com.
Students can also find themselves without adequate insurance when they leave home, which is particularly worrying with young people three times more likely to be victims of burglary. Some students are covered by their parents' policies but it is vital to check and to take out separate protection if this is not the case.
A standard household contents policy with Aviva, for instance, gives £5,000 worth of cover for items "temporarily removed from the home". This includes belongings in a student's room, at their shared house or halls on campus and covers them for all standard perils such as fire, storm, flood or malicious damage. Theft is also covered, but only if someone physically breaks into or out of the accommodation.
Some items, such as expensive laptops and bikes, may need additional cover. It's also a good idea to register your mobile phone and other personal items for free on www.immobilise.com. Your property is given a unique identification mark and registered on the site. The police use the site when they have recovered stolen property to try to match the belongings to their owners.
People should also look closely at the value of their clothes, warns Hiscox. The average person spends about £1,000 a year on their gear while the fashion-conscious splash out up to £400 a month. Hiscox's Austyn Tusler says: "Many people don't have a grasp of the value of the clothing and accessories they have accumulated over the seasons.
"As a result, many people may be underinsured when it comes to their wardrobes. One female customer, for example, gave us an estimate of approximately £3,000 to cover her wardrobe contents but, once we had reviewed it, the total was actually more than £25,000."
Five Questions: Changes to car tax discs
Ticking time bomb: Interest rate rises are coming, so start preparing now
Peer to Peer lending: This alternative market is offering firms a lifeline
More than 300,000 adults are too deeply in debt to apply for bankruptcy
Debt problems: How you can nip your money problems in the bud and sleep easy at night
- 1 Five-year-old Iris Grace is raising awareness of autism through her extraordinary paintings
- 2 Expert urges cat lovers to own just one animal each
- 3 Sainsbury's '50p challenge' poster telling staff to encourage customers to spend more placed in shop window instead of staff room
- 4 Yes, the iPhone 6 is a miracle, but it's Apple's tax affairs that deserve a double take
- 5 Car tax disc changes: Two days to go - and they affect you much more than just not displaying a piece of paper
Isis, we are told, is a 'clear and dangerous threat to our way of life'. I’m sorry, but I just don’t buy it
Exclusive: 'Putin's Russia has been my biggest regret,' says Nato's outgoing Secretary General
The Osborne Ultimatum: Chancellor’s benefits freeze bombshell will affect ten million households
There’s no excuse for Dave Lee Travis’s behaviour, but we need to keep a sense of proportion
Should gay sex be illegal? 16% of Britons think so
Mark Reckless becomes second Tory MP to defect to Ukip in a month
- < Previous
- Next >
iJobs Money & Business
£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...
NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...
£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...
Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...
Day In a Page
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
A six-bedroom farmhouse with five acres of land in a former cloth-making village
A secluded seven-bedroom detached house with large private garden, £490,000
A three-bedroom cottage overlooking Sarratt village green with open fires and solid oak floors
A three-bedroom maisonette flat in a Grade I-listed, Georgian townhouse in a sought-after location