Down the chimney and out the door: are these gifts insured?
Sunday 22 December 1996
But financial succour is at hand if you are currently practising making "Oh! That's, um, lovely!" sound convincing. For a pounds 25 premium, Grip, a Lloyd's of London insurance broker, will insure you against any lapse in taste by your nearest and dearest. "We'll pay pounds 100 if you get a present which an independent panel of assessors agrees can best be described as naff," explains Simon Burgess, the managing director of Grip. However, he warns that the policy does exclude socks, underwear and aftershave.
If insuring against presents you do not want sounds a bit much, there is a better case for making sure you have adequate cover for any gifts that are genuinely valuable. Depending on your own budget as well as the persuasive powers and generosity of your loved ones, the value of your house contents might suddenly jump at this time of year.
Presents such as personal computers and video recorders might also be on the shopping list of your local burglar - thefts jump by around 10 per cent over the Christmas period, according to the Association of British Insurers (although even thieves like to take a holiday during the Christmas break itself -there were fewer burglaries on 25, 26 and 27 December in 1995 than on any other days of the year, according to Eagle Star).
The limits on some home contents insurance policies increase automatically over Christmas to cover such risks. Direct Line, for example, increases the amount covered by its policy by 10 per cent between 1 December and 5 January.
Other insurers believe that increases like this are largely a gimmick. A spokesman for Commercial Union, for example, argues: "Our policy offers pounds 30,000 of cover as standard, which should be more than enough for most people."
However, all the insurers agree that you need to watch out for individual limits of, typically, pounds l,000 to pounds 1,500 for high risk items, such as televisions, PCs and videos. If you have bought (or receive) anything that is over the limit of your contents policy, let your insurer know; you may have to pay a small additional premium to make sure the item is fully covered.
Watch out, too, for bike cover. Most contents policies will provide cover of up to pounds 200 or more for bicycles stolen from homes or a locked garden shed. But if you want the bike to be covered for theft or damage outside your home, you will have to pay for extra insurance. The cheapest option is usually to get an "all-risks" extension to your house contents policy to cover the bike. The cost varies a lot from one insurer to another and usually depends on where you live.
The additional premium for an all-risks extension for a pounds 200 bicycle would, for example, be pounds 7 to pounds 10 a year from General Accident, pounds 10 to pounds 17 from Sun Alliance Connections, pounds 12 from Direct Line and up to pounds 10 from Commercial Union.
Not all insurers are that accommodating - Churchill Insurance, for example, only offers all-risks insurance for a minimum of pounds 2,000 of goods. Even if you only want to insure a bicycle that still means the minimum additional premium is likely to be of the order of pounds 45, according to a Churchill spokeswoman.
Specialist cycle insurance policies are generally only worth considering if you have got an exceptionally valuable bicycle. Insuring a pounds 200 cycle if you live in London, for example, would cost as much as pounds 100 a year if you bought the LeisureLine cycle policy from Harrison Beaumont, an insurance specialist in Witney, Oxfordshire.
As well as insuring presents against theft or damage, there is also the risk that they simply break down.
New electrical goods will usually have a manufacturers' warranty covering at least the first year. Extended warranties sold by retailers that cover the first three to five years have been condemned by the Consumers' Association as being generally "overpriced, oversold and overrated".
But there are a few stand-alone policies sold by insurers that may be worth considering if you have a range of fairly new goods that are no longer covered by the manufacturers' warranty.
Norwich Union Direct offers a policy with a flat pounds 7.95 monthly premium that covers up to 10 items, including a video, television, washing machine and microwave, provided they were bought less than eight years ago.
TSB and Sun Alliance Connections both offer similar policies, although the premium in each case depends on the items covered. Insuring a video and a microwave, for example, would cost pounds 6 a month with the Sun Alliance policy and (assuming both items are less than four years old) pounds 5.50 a month with the TSB policy.
q Contacts: Norwich Union Direct 0800 888 777; TSB - local branch; Sun Alliance Connections 01473 291010.
Jean Eaglesham works for `Investors Chronicle'.
Christmas up in flames
Open fire lovers beware: there is a bigger risk of fire damage to your home at Christmas than at any other time of the year, warns Eagle Star. The eight days between Christmas Eve and New Year's Day all came in the worst 20 days for domestic fires last year, causing pounds 9m of damage, says the insurer.
Graham Johnston, a director of Eagle Star, said: "People are becoming more aware of the risks of being burgled during the Christmas period and are rightly taking extra precautions to safeguard their presents and other valuables. But there is nearly as much chance of suffering a fire as being burgled. Many people seem to be running unnecessary risks, whether it is forgetting to take the turkey out of the oven or falling asleep after lunch and failing to watch a blazing log fire."
Saga, a company that specialises in insurance and other services for the over-50s, has produced a free guide to keeping homes safe and secure over the Christmas/New Year break. The booklet includes tips to avoid fires, as well as burglary, burst pipes and subsidence. Call 0800 505253.
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