How do you determine the Home Insurance Contents Sum Insured?
Answer:
Contents Sum Insured
To ensure that your Contents Sum Insured is adequate the only way is to complete an Inventory of your contents. There is no such thing as a standard Sum Insured. We are all individuals and our life style reflects this
Inventory
Making an inventory of your household contents is simpler to do before rather than after a claim. In the event of a serious loss your Insurers will ask you to list out and present a claim for any contents which have been affected.
This is easy if the items are still available to be seen but in a fire that will not be the case.
In support of your claim Insurers will ask you to provide information concerning any item claimed to enable them to verify the level of the claim or to organise replacements. You may be asked to provide purchase receipts particularly for expensive items.
It is therefore sensible to produce an inventory of your household contents now. It will also help you establish what the total value of your contents is.
You will be surprised as to the total value.
A significant number of people who take out insurance do not realise they are underinsured until they suffer a loss. Do not be one of them.
How do you produce an inventory
We have produced a simple Inventory Form for you to complete Inventory Form
The simplest way to prepare an Inventory is to inspect each room in your house. Then list out the items present in each room.
Try to give as much description as possible. Try to list Manufacturer Model Number Where and When Purchased and if possible find a receipt.
Your policy will generally cover you against New for Old so when completing the Inventory make allowance for the items current replacement cost.
If possible take photographs of room layouts and also photograph expensive items and if possible include in the photograph a ruler which gives some idea as to the size of the item.
Photographs help to confirm that the item existed and make it easier to describe an item rather than having to use words.
Remember to attach Valuations particularly in respect of jewellery and any other expensive items such as antiques items of precious metal paintings or works of art.
Remember that your Sum Insured is supposed to reflect the value of all your home contents, do not forget the attic garden shed or garage.
You will be surprised about how much value there is in these areas.
Looking after and updating the Inventory.
Now that you have gone to the effort of producing an Inventory keep it safe.
Make sure if you have produced the inventory on your computer or in paper form that copies are kept at work at friends or with family.
Don’t rely on having one copy at home if it is on your computer it may be stolen or it could be lost in a fire.
Once the hard work of completing an inventory has been done then to keep it up to date all you have to do is add on items to reflect new purchases and hopefully you will not risk the possibility of being under insured in the future.
Home Inventory PDF Format
For those of you who wish to complete a detailed inventory incorporating photographs and detailed descriptions please visit the following site Computer Based Home Inventory. The programme is free
Effect of Underinsurance
In the event that the sum insured is not adequate Insurers may not pay the full value of any insurance claim. They may pay the cost of replacement net of an allowance for wear and tear alternatively dependant upon the policy wording they may pay a proportion of the loss based upon the degree of underinsurance. For this reason it is important to adequately assess the sum insured.
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