Household insurance – are you getting sufficient cover?

13/06/11 General

Not all household insurance policies offer the same level of cover,
they are designed to fill different insurance needs. In particular, there
are policies available for those who have accumulated value in their home,
its interior decorations and possessions and want to ensure they are
covered should the worst happen.

Here are two examples of claims on premium household policies showing the
broader cover offered:

Burst Boiler Bills
A burst boiler caused significant water damage to a kitchen floor and the floor level
kitchen cupboards. The kitchen was open plan with an adjoining dining area and
playroom. The same walnut wood floor was laid throughout. Although the water
had only damaged the floor in the kitchen area, it was impossible to match the new
floor to the remaining walnut floor.

Recognising that this was not acceptable aesthetically, the insurer offered to
replace the walnut floor in all three rooms. So, in addition to replacing the
cupboards, the insurer paid a total of £16,000 to replace the whole floor. Some
standard policies would have paid only to replace the floor in the kitchen area.
This would leave the client either with a mis-matched floor or out-of pocket
by about £10,800 if he’d chosen to replace the whole floor himself.

Wet Watch
A policyholder lost a vintage Rolex while sailing in a water park. The watch was of
huge sentimental value as it belonged to his father. Understanding this, the insurer
offered to send out a diver to see if it could be located. Luckily, visibility was good
and the watch was found.

If it had not been recovered, the insurer would have paid the Agreed Value of £35,000
with no deduction – letting the watch be replaced, or not, as the policyholder wished.
With a standard policy there may have been no attempt to recover the watch, despite
its sentimental value. Instead, the insurer may have simply offered the trade price of
around £28,000, less any excess. A difference of over £7,000.

Not all policies are the same, we are here to help you find the one that best fits your
needs at the right price. To review your requirements, please contact us.

Claims examples provided by Chubb 2010