Many people do not realise how much they could lose by being under-insured , says Conal Gregory
YOUR belongings are not just an expression of your personality, but a major investment that needs proper protection. Yet many do not realise how much they would stand to lose if they were to make a claim.
Under-insurance is a serious worry. Ov
er the years, so many possessions can be accumulated that it is easy to forget to have things insured properly. The replacement cost of many articles may come as a shock – particularly if it is an heirloom – but that is the figure that should be calculated. Insurers have the right to reduce a claim if a lower value has been insured.
Consult an experienced adviser. Higher net-worth insurers (usually for contents valued at more than £75,000) interpret clauses thoroughly.
Make sure that a record is kept away from the property, perhaps at a bank or with a solicitor. Keep a photographic as well as a written record, both to prove ownership and to pass to the police in the event of theft.
Detail the model and serial numbers of cameras, clocks and watches, and record marks on ceramics, silver and gold. Take down dimensions, particularly of paintings and furniture.
Insurers like valuations from specialists, which in the case of period items would usually be a member of the British Antique Dealers' Association or a recognised auction house. Ensure valuations are no more than five years old.
For jewellery and other precious items, a safe is advisable and articles placed in it will attract a lower premium. An alarm linked to a monitoring station will also reduce your insurance costs.
Consider accidental damage cover, which should include claims caused by pets. This is usually for television, video, audio and computer equipment. One of the perks of a good contents policy is that some items are covered when outside the home. This may mean a saving on travel insurance, as belongings should not be insured twice. Another bonus is that articles belonging to a youngster away at school or college are protected without a separate policy.
The cost of replacing locks and keys for outside doors, as well as for alarms and safes, should be covered in the event locks are stolen.
A good insurer will let the policyholder decide if they want a claimed item replaced or the equivalent in money. You may, for instance, want to trade-up to a superior model.
Ask how an insurer treats a pair of items, usually worth far more than two similar articles. They may simply restore a single damaged item, rather than replace the pair.
It's vital to declare anything valued at or above the 'single article limit'. This does not necessarily raise the cost but lets the insurer know their liability. As a current example, retailers saw a huge rise in sales of plasma televisions to view the recent Olympics, but there has not to date been a corresponding report of the same to insurers.
Don't forget items of value outside the house, which may be in a garage or outbuildings, from frozen food and garden equipment to patio furniture and the barbecue.
The full article contains 539 words and appears in The Scotsman newspaper.
