is new for old worth paying extra for?

cashcow_4

I am in the middle of purchasing contents insurance and one of the options is to pay extra for their 'new for old' cover.

How does this work?

It sounds simple, but I don't think my interpretation of their wording would match theirs.

Let's say I have a TV that cost £1,000 to buy 4 years ago. It gets stolen / blows up / house floods or whatever, would this 'new for old' cover mean I get a new TV to replace it at the value of the TV when I bought it or at it's current value?

Some of my stuff was expensive when bought, but certain things aren't available for sale brand new any more, what would happen in that case? Do they replace it at it's current value? (in which case how is that 'new for old'?) or do they replace it with it's current day's equivelant or close to?

I am not sure how it works or if it's worth the extra money?

Linda32

I would presume it would be replaced with todays equivelent.

However, I've never come across a policy where that has been an option. They just offer new for old anyway, in which case I would assume you would get todays equivelent.

bookgirl_2

New for old cover is the industry standard now, only a couple of insurers offer indemnity cover (Pru and CIS from memory).

If your 4 year old £1000 TV was stolen (say), then under a new for old policy you would get the current equivalent in terms of spec, size, quality. It is possible that your insurer would actually replace the TV for you, or give you vouchers for the replacement cost for one of the big electrical stores.

For an indemnity policy the value of the TV is assessed as the price new, less an allowance for wear and tear and depreciation. Settlement for indemnity policies is cash, so you can buy what you want, but it would not be as much as the settlement on new for old.

Overall, new for old is unlikely to cost you much more, but should the worst happen and you need to make a claim you would notice the difference.

Hope that helps!

jenniferpa

I would check if the insurance company had a voucher policy. There was a thread on here a few days ago about someone who had been offered argos vouchers for part of her claim and the adjuster was presuring her to accept those, saying that she would get less money if she wanted cash.

Jennifer

I'mcomingbackasaman

jenniferpa wrote:

I would check if the insurance company had a voucher policy. There was a thread on here a few days ago about someone who had been offered argos vouchers for part of her claim and the adjuster was presuring her to accept those, saying that she would get less money if she wanted cash.

Jennifer

I had house contents insurance with an insurance company who gave me vouchers for Argos - a shop I don't purchase from very often so I wasn't impressed. Sorry can't remember insurers. I changed to another company 2 years ago.

lday77

I'm with Direct Line, we were burgalled last November and they stole sooo much stuff (inclusing christam presents).

Direct Line were great, they gave us a cheque for the things they wouldn't be able to replace (my purse/money + money up to £300/game for my ngage) we then got a combination of vouchers and replacement items. The vouchers were for different stores, i.e. jessops for the camera, lesley davies/h samuel for my watch and necklace, high street vouchers for the other stuff.

And it only took about 3 weeks to get everything back, it's not the same as having my old stuff and the new stuff just reminds me of the burglary but DirectLine were really great in what was a really awful time, and they were the cheapest I could find on the net.