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  • FIRST POST
    • LMC79
    • By LMC79 9th Jul 17, 6:38 PM
    • 2Posts
    • 0Thanks
    LMC79
    Home Insurance Specified Item - value entitled to
    • #1
    • 9th Jul 17, 6:38 PM
    Home Insurance Specified Item - value entitled to 9th Jul 17 at 6:38 PM
    Hi,

    We have home insurance with esure, it is a new for old policy and we have a number of specified items over £1,500 single item limit.

    Recently we had our garage broken into and they stole my husbands bike. We have the value specified at £2,800 as this was the RRP when we bought in 2010 (though I recognise from reading other forum posts that we perhaps should have been adding more for inflation). Albeit when he purchased it we did pay slightly less as he shopped around online and got it slightly cheaper but I believe you are meant to put RRP? It was at the time a reasonably high end bike.

    The insurance company's supplier are offering a similar specified bike (to that stolen) worth £1,700. Their reasoning is that this is now the equivalent bike, and it is lower in price as bike technology has moved on so whilst in 2010 it was a reasonably high spec'd bike it now isn't. So our argument is we went with a new for old policy and continued to insure at the original RRP to replace with whatever the equivalent technology would be. Because if my husband was to purchase a bike now with the same amount of money, he would still go for a reasonably high end bike not a lower spec equivalent, as he is a keen cyclist and often competes in events.

    Do we have any justification here in what we are saying? I do understand that we are getting a replacement for what was lost, but the market/ technology has changed, and we have continued to pay a higher premium rather than reduce the value stated on the policy and pay a lower premium. And it feels if we accept what they are offering we will actually be out of pocket as my husband will likely want to upgrade.

    I know if the shoe was on the other foot and market value had increased dramatically beyond £2,800 they would be quick enough to only offer £2,800 (as is the case I have read for forum post where people have been caught with watch/ jewellery market increasing values substantially!)

    Any advice/ expert input appreciated.

    Thanks
    Laura
Page 1
    • dacouch
    • By dacouch 9th Jul 17, 7:23 PM
    • 20,290 Posts
    • 12,532 Thanks
    dacouch
    • #2
    • 9th Jul 17, 7:23 PM
    • #2
    • 9th Jul 17, 7:23 PM
    They are correct, if their offer of a replacement is an equilavent of the bike that was stolen then they are correct. You have no right to a better specified bike just because technology has moved on
    • paddyandstumpy
    • By paddyandstumpy 9th Jul 17, 7:46 PM
    • 916 Posts
    • 409 Thanks
    paddyandstumpy
    • #3
    • 9th Jul 17, 7:46 PM
    • #3
    • 9th Jul 17, 7:46 PM
    As above, they are offering to put you back into the pre loss position, which is all you're entitled to.

    In actual fact; you could accept the new (equivalent) bike, sell it as new, and then put that towards a higher end model.

    You're being given a brand new bike to replace a used model, so you're actually getting an element of betterment.
    • Blibble
    • By Blibble 9th Jul 17, 9:02 PM
    • 251 Posts
    • 112 Thanks
    Blibble
    • #4
    • 9th Jul 17, 9:02 PM
    • #4
    • 9th Jul 17, 9:02 PM
    You are being put back in the same position as pre-incident.

    It just so happens that the position in question is a bike with 7-year old technology.
    • agrinnall
    • By agrinnall 10th Jul 17, 7:37 AM
    • 18,750 Posts
    • 14,447 Thanks
    agrinnall
    • #5
    • 10th Jul 17, 7:37 AM
    • #5
    • 10th Jul 17, 7:37 AM
    Sounds pretty much like "new for old" to me.
    • Aretnap
    • By Aretnap 10th Jul 17, 4:32 PM
    • 2,843 Posts
    • 2,339 Thanks
    Aretnap
    • #6
    • 10th Jul 17, 4:32 PM
    • #6
    • 10th Jul 17, 4:32 PM
    Indeed, their obligation is to provide a like for like replacement. You're not out of pocket because you didn't get a better bike than the one which was nicked. (In fact you are getting a better bike than the one which was nicked in that it will be new rather than 7 years old).

    If your husband would rather upgrade than take an equivalent spec bike, ask them if they'll settle with cash or vouchers rather than providing an actual bike - or even just supply a higher spec bike and let you pay the difference in price yourself.

    Note that if they settle with cash the amount of money is likely to be lower than £1700 - insurers are in a position to negotiate quite big discounts with preferred suppliers, and a cash settlement would generally reflect the price the insurer would have paid for the bike, rather than the price you or I would pay for it. If you get vouchers then the value will likely be closer to the retail price (as the insurer can get a discount on those too), though of course you'd be restricted in your choice of supplier.
    • LMC79
    • By LMC79 11th Jul 17, 9:31 AM
    • 2 Posts
    • 0 Thanks
    LMC79
    • #7
    • 11th Jul 17, 9:31 AM
    • #7
    • 11th Jul 17, 9:31 AM
    Thank you everyone, sorry I wasn't getting notifications of replies (newbie). I understand we're not out of pocket and that the 'new for old' is being honoured, I just didn't know if for specified items it was different.

    I do just wonder then why they make you specify a value (which I thought in putting original RRP was the right thing to do as opposed to current market value). As no doubt I have been paying a slightly higher premium for insuring at £2,800 rather than £1,700. Why don't they just leave it at make and model? As I've read about people penalised when it's the other way (e.g. putting make and model of a watch, but not increasing its value from what they paid, then finding that costs of metal etc have rose substantially). And in these instances the insurance company refusing to replace with the same/ equivalent model and only paying the value declared on the specified item. Which is just the inverse of what we're saying!

    But we will see what they say about upgrade options.
    • paddyandstumpy
    • By paddyandstumpy 11th Jul 17, 10:46 AM
    • 916 Posts
    • 409 Thanks
    paddyandstumpy
    • #8
    • 11th Jul 17, 10:46 AM
    • #8
    • 11th Jul 17, 10:46 AM
    You could ask them what the difference in premium is between a £1700 and a £2800 bike.
    I'd not imagine it's more than £22 (2% rate on the difference)
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