Strange call with insurance co re B&C renewal

Badger_Lady

Blanket Cover (as OP describes) is a safe option because it relies on the insurer to provide the right amount of cover at the right price. If you opt for Sum Assured cover instead, you have to give them a figure and that figure can be disputed at claim time, sometimes leaving you short.

If the Blanket Cover option is cheaper (it often is), go for it! Nothing to lose

Chinkle

I consider myself to be reasonably financially savy, but didn't know there were two types of policy: blanket and sum assured cover, so please accept my apologies for all these questions.

Badger_Lady

Not many people do! And there is this natural belief that it will be more expensive, so insurers don't particularly shout about it. About 30% of home insurance buyers prefer the confidence that they're covered, while the other 70% just want a bargain...

mikey72

Chinkle wrote: »

Called my insurer to review/renew our insurance cover and was surprised about the responses to some of my questions and therefore wanted to know what you think:

Buildings cover – sum assured: asked how they have derived this, oh it’s the minimum amount of cover we require of everyone. “Regardless of house size/type” I asked? “Yes” was the reply. Now the amount is £500K which is a good deal more than the average house price in the UK let alone rebuild cost – so theoretically most people with this insurer will be over-insured for rebuild.

Contents cover – again I am told that there are minimum amounts for theft from garages/outbuildings of £1,000 and £5,000 per item for valuables and £5,000 per item for entertainment items even if we don’t need that cover.

Does this sound strange to you? Please don’t reply just to say move elsewhere, as I have done price comparison sites and this is still the cheapest cover for us, just want an opinion as to whether this sounds right – I didn’t have a great deal of confidence in the person at the call centre to a number of my questions.

Who are they.
If it's the cheapest, and you don't have any faith in them, maybe alternatives may be a better option.

foggytown

Chinkle wrote: »

I consider myself to be reasonably financially savy, but didn't know there were two types of policy: blanket and sum assured cover.

There aren't, really. On the retail side it's just another actuarial "sideways arabesque" turned into a marketing ploy. (It may also have something to do with the companys reinsurance programme and how it's structured.)

It's all in the presentation. The general public goes "WOW" when they are told that their two-up-two-down mid-terraced in Neasden is insured for "up to £500,000". (Somewhere in much smaller print: but not more than it actually costs to rebuild the hovel.) Makes us feel nice and safe! Then, with the other info on the proposal, the company can estimate the actual rebuilding cost and charge that portion of the premium accordingly. But you never know how much you were actually charged for that portion of the cover. At least it does relieve the insured of the responsibility for providing his own rebuilding value (and usually hugely overestimating that).