In home insurance, how do they calculate wear and tear?

globularity

Just took out a policy with the AA, and tho I never expect to claim on my insurance, the £100 excess and wear and tear deduction might leave me with nothing if my bike was stolen. I purchased it at £260. If anybody knows how wear and tear is calculated that would be great. Bike is now 1 yr old and emaculate

Owain_Moneysaver

If bike would be expected to last for 5 years it depreciates at £52 per year (£260 ÷ 5) so after 1 year it would be worth (£260 - 52) = £208.

InsideInsurance

Most home insurance would replace it new for old as it tends to only be clothes that are indemnity basis

Different insurers have different methodologies for calculating these things but most do use a simple linea percentage deduction until it hits a floor value.

edenbisdee7215

Every thing is fine going, for insurance understanding why not you consult your firm or deal papers.

*Scarlett

Most policies exclude damage caused by wear and tear So if the bike has just got a bit old and knackered you can't claim for a new one on your insurance.

However many policies are "new for old" (with certain exclusions) so generally you would expect the bike to be replaced by a new equivalent model if it had been stolen as long as you have complied with any conditions they might have as regards to covering bikes. Some policies cover bikes up to a certain amount as standard, others may require you to specify them if you want cover away from home and they may want you to secure the bike when unattended.

If you are in doubt, check your policy book or ring the insurer to clarify.

rs65

globularity wrote: »

If anybody knows how wear and tear is calculated that would be great.

I would have thought an adult bike would be written down by 10% a year, basically a 10 year life expectancy. A childs bike would be 20% a year, 5 year life expectancy.

Best to ask your insurers as they will no doubt have a method of calculating.

AA must be a bit behind the times, I thought wear and tear deductions on bikes was a thing of the past

Shenanigan

Direct Line Group (used to be RBS Group) policies tend to include wear and tear in claim payouts only for Clothes and Linen. How this is calculated I wouldn't know.

inoutnotsure

Wear and tear is generally for items that have a 'short lifespan' and easily damaged such as clothes, carpets and curtains. Insurers generally have a company they go to to find out the current market value of your item if it still exists and quite common. On older items, they just find out the original cost and make a 'finger in the air' deduction. This is often fair though.

dacouch

inoutnotsure wrote: »

Wear and tear is generally for items that have a 'short lifespan' and easily damaged such as clothes, carpets and curtains. Insurers generally have a company they go to to find out the current market value of your item if it still exists and quite common. On older items, they just find out the original cost and make a 'finger in the air' deduction. This is often fair though.

Carpets and curtains not with a normal insurer

Just_Some_Guy

Even if the wear and tear deduction was £0 claiming will put your premium up by say 25% or so for a few years. You can do the math to figure out whether claiming is worth it or not in the long run.

Check the fine print around bike theft, my policy requires me to have it chained up like a medieval traitor when I'm not actually riding it (even when it's in the shed).

inoutnotsure

Not quite sure what you mean. But to clarify, my understandins is that wear and tear applies in both buildings insurance and also in contents insurance.

You are right if you mean carpets and curtains are not normally included under contents insurance (assuming this because this bike matter relates to contents side), but the wear and tear policy still applies to carpets and curtains under the buildings side. My comments were just generalisation.