Help with an insurance claim

AlisonHarrison

I lost my engagement ring recently and made a claim from my insurers.
The ring was listed seperately in the policy at £5k. The valuation was done many years ago.
The insurers asked for the valuation, which I gave to them and the ring is now valued at £8k. However, they have offered me £5k. How much do they have to pay?
I am just wondering if they are right to offer this amount.

Faith177

If you have only specified it for 5K that's all they have to pay.

The onus is on you to check the value of your items and keep it up to date especially with the cost of precious metals changing as it has.

chanz4

you told them £5k, so that is the insured amount. you would need to of got a recent updated valuation when taking insurance out

InsideInsurance

Your lucky to get an offer of £5,000!

Given you've underinsured most policies have an averaging clause, which means they discount the sum insured by the same amount of the underinsurance in which case their offer would be £3,125 and the excess then would be taken off of it.

Only possible ray of hope..... have you been with this insurer for a long time or did you just switch to them this year?

AlisonHarrison

Many thanks for the reply.
The valuation was done in 2004 (date of probate). I took out the insurance in 2007.
So does that mean that for the rest of the items of jewellry I own I should get a valuation done every year?

AlisonHarrison

I am wondering what they would pay if the value dropped instead of increasing.
Would they pay the insured amount or pay the value at today's date?

InsideInsurance

It is not a declared value policy and so the value you set is the maximum valuation they will pay so it is in your interest to get as close to the correct valuation as possible as they'll never pay more but will pay less.

Every year is probably excessive but every few years is advisable particularly when situations we've had where post credit crunch the price of gold/ diamonds etc sky rocketed

A professional valuation is always good to have for a variety of reasons but assume you're talking about modern high street jewellery (ie not collectables or antiques) then it may be sufficient to simply check what the current retail price is for a similar item. Evidently high end branded items that have been discontinued may well be worth more than their modern day equivalents.

You say its been insured since 2007, was that with the same insurer continuously or have you switched insurers or even cancelled the renewal and bought as a new customer from the same insurer in that time?

AlisonHarrison

InsideInsurance wrote: »

You say its been insured since 2007, was that with the same insurer continuously or have you switched insurers or even cancelled the renewal and bought as a new customer from the same insurer in that time?

I changed insurers in 2007 as I realised I was underinsured and my existing insurer could not offer the facility to up my insurance. It was a standard £40k for contents.
I have not changed insurers since. I changed in 2007.
So is it just specified items that you are expected to get revalued periodically.
This is an item which was specified on the policy.
Much obliged for your responses.

Faith177

Really you should be re-assesing your contents sum inusred every year as the cost of things increase.

I.E a carpet that cost you £400 5 years ago could now cost £600 to replace like for like.

Direct line have a really good page under their home insurance section that breaks your house down room by room and thinks of everything from cutlery & plates to sofa's & tv's.

If you want to specify something though it's best to do this at least every 2 years

AlisonHarrison

What makes me think that they should be paying the full amount is that they said that they would waive the excess so that I would not be penalised twice.
I may just be ultra suspicious because I have dealt with insurance companies on a number of occasions and I have never known them to waive the excess so I was not penalised twice.
In my experience they try to avoid paying out at all costs and to waive the excess over something that would appear to be my fault seems odd.

InsideInsurance

AlisonHarrison wrote: »

So is it just specified items that you are expected to get revalued periodically.

You need to consider the correct value for all your contents annually however for high value items it is worth going the extra mile.

I wouldn't necessarily specify just specified items as that'll depend on your policy - mine has an unspecified single item limit of £15,000 and as we have no single item at that we dont have specified items but the wife's engagement ring, a couple of branded watches etc do need consideration.

Likewise you need to be careful that something that last year was below the specified item limit hasnt since increased in value and thus must now be specified.

It is possibly worth having a look on the FOS's website for publications on complaints (or wait for a Home expert to come on here). I know there have been many complaints in the past about insurers who said they automatically increased the sum insured each year at renewal to reflect inflation however that increase was insufficient. The obvious insurer defense is that it is the insured's responsibility to check the figures are still correct and the index linking is just for assistance in doing so but I don't remember off the top of my head how the FOS viewed the matter.