You can probably think of a hundred things you'd rather be doing this weekend than calculating your home contents insurance. But when you take into account only 48% of policies increase the sum insured at renewal to match general price increases, it's a task you need to stay on top of. Particularly if you've improved or updated your home contents over the year.
If you've underestimated the cost of replacing the contents of your home, in the event of theft or a disaster such as fire or flood, you could end up thousands of pounds out of pocket. Suffering the loss or damage of your personal belongings can take its toll emotionally, too. If you have your contents calculated properly, you can take some of the financial sting out of the ordeal.
The main reason you need to review the amount on a regular basis is because the value of your home's contents are likely to evolve over time. Just look at the increasingly sophisticated technology that we bring into our homes. From flat-screen TVs to the latest smartphones and laptops, the belongings we collect over the years have the ability to drastically change the collective total of our home contents. Regular calculations need to take place so you can let your insurer know the correct value of your possessions.
'Home contents' doesn't just refer to your valuables such as expensive electronic equipment and jewellery. Everything you might need to replace within your home should be included when you are making your calculation, including furnishings such as curtains and carpets. A standard policy will insure your belongings on a 'new for old' basis, so your possessions will be replaced with items of the same monetary value, except for clothing where the value diminishes with time to allow for wear and tear. You need to make sure your insurance includes an accurate valuation to make sure you're properly covered.
The best way to calculate your contents insurance is to look at each room and break down all the items with an estimation of how much they cost. You can find online tools to help you figure this out. Common items to consider include: sofas, armchairs, units of furniture such as bookcases (don't forget the books inside the bookcase too), washing machines, bicycles, IT equipment, garden furniture, and kitchenware.
Digital downloads are also considered to be something you might need covered. Check with your insurer if you need to take this into consideration. Finally, don't forget to insure those things you carry around with you in your bag or pockets on a daily basis, you can purchase additional cover for items taken away from the home.
Don't assume your home contents insurance will cover all your expensive items. Insurers will set different limits for how much they're willing to pay out for a single item and some policies may not sufficiently cover your expensive camera equipment or laptop. If you have a particularly expensive item such as a watch, jewellery, electronic equipment or piece of art that needs insuring, speak to your insurer about the need for additional cover. You might even want to take out a separate policy if the item requires specialist insurance.
It's a good idea to review your home contents insurance at key times throughout your life:
Remember you might need to provide proof you owned the item in order to make a successful claim. This is to prevent fraud where people make claims for items they don't actually own. Your insurer will be able to advise you on what you might need to provide in the event of a claim, you may need to take photographs of items or show proof of purchase.
Good practice for householders is to scan any receipts for expensive items in the home and save the documents, along with any online receipts, into a special folder know you'll be able to access even in an emergency. If you just keep the paper version and a fire or flood strikes, those carefully stored receipts may well be destroyed, too.
Not all contents insurance policies are the same and you might want to include additional cover for accidental damage. This is usually offered as an optional extra but make sure to check your policy wording before you buy to see if you need it.
If you've got any questions about your home insurance policy, give us a call on 0333 321 9681.