New for old - how does it work?

TrixA

We recently moved house and were burgled about a month after moving. They took mostly electronic items, including my husband's laptop which he uses every day for work. As such, we had to buy him a new one immediately. We have also bought replacements for a couple of other items that we use regularly.

This is the first time we've made a contents claim and we thought 'new for old' meant they would pay out for the replacement value of the items. However, I've just had a message from the electronic items valuer suggesting that they are going to provide us with replacements for the actual items, rather than a cash settlement. How does this work? Will they match the brands or just the approximate spec? What if we were already planning to upgrade to a better/more expensive model? What happens with the items we have already replaced?

forgotmyname

They will have a list of suppliers where they get discounts on the items. You can sometimes choose a cash settlement instead but its usually a fair bit less than the retail price.

They will try and match the spec on most items.

whatmichaelsays

We experienced something similar and the insurer provided us with a voucher to the value of the goods that were stolen. (I think the voucher was for Comet).

There's usually little restriction on what you can buy with the voucher, as long as it's stocked by the insurer's preferred supplier.

TrixA

forgotmyname wrote: »

They will have a list of suppliers where they get discounts on the items. You can sometimes choose a cash settlement instead but its usually a fair bit less than the retail price.

They will try and match the spec on most items.

So if we've had to replace the item because we can't afford to wait for the insurance settlement we're going to have to accept a lower cash price such that we are out of pocket? That doesn't seem fair.

rs65

TrixA wrote: »

So if we've had to replace the item because we can't afford to wait for the insurance settlement we're going to have to accept a lower cash price such that we are out of pocket? That doesn't seem fair.

Your policy will tell you how claims are settled. You could've spoken to your insurers about items that needed replaced immediately.

ps Check you are covered for items used for work.

TrixA

rs65 wrote: »

Your policy will tell you how claims are settled. You could've spoken to your insurers about items that needed replaced immediately.

ps Check you are covered for items used for work.

I've checked the policy and it just says they will either "replace as new" or "pay the cost to us of replacing as new". What it doesn't make clear is who gets to decide what's a reasonable "as new" replacement for models that are no longer available. I don't want to be forced into accepting a poor match on the basis that it's stocked by their preferred supplier.

OnanTheBarbarian

If they provide a like for like spec machine like the laptop, just stick it on eBay ��

Mattygroves2

TrixA wrote: »

I've checked the policy and it just says they will either "replace as new" or "pay the cost to us of replacing as new". What it doesn't make clear is who gets to decide what's a reasonable "as new" replacement for models that are no longer available. I don't want to be forced into accepting a poor match on the basis that it's stocked by their preferred supplier.

The insurance company or their loss adjuster decide. If you don't agree then you'll have to provide proof why they aren't matching the original spec. It isn't hard to match the spec of a laptop though.

As has been said you should have spoken to them about the process for items that needed replacing immediately.

Aretnap

The reason for offering a replacement item rather than cash is two fold. (1) the insurer is in a position to negotiate big discounts with preferred suppliers, which keeps down the cost of claims and so ultimately keeps down premiums and (2) it means there's less incentive for people who've want to upgrade their laptops to throw the old one down the stairs and try to claim a pile of cash to put towards the replacement.

If you don't think the replacement laptop they're offering is a reasonable replacement for the old one then you can say so, and if necessary make a formal complaint. Ideally you would be able to point to one or more features which the old laptop had which the replacement didn't - such as hard drive space, screen size, processor speed - the more objective the better. It would be more difficult to base an argument on more subjective things like brand reputation or build quality.

TSx

If you explain you've already replaced they should give you a cash settlement. The 'discount' on electricals is fairly low (where I work, currys are often cheaper than our electrical supplier can obtain) - in terms of specs and brand, the specs should be as good if not better and the brand should be equivalent (e.g if you had a brand name one, not replacing with an own brand one)

InsideInsurance

Its your choice, generally, if you go for cash or goods however the insurer is entitled to reduce a cash settlement with the discount they'd have received had they given you the goods. The only time they cannot is if their suppliers are unable to supply a suitable replacement.

Giving actual goods is less common than it used to be and more commonly these days is to get a "gift card" for Currys or H Samuels or whoever is appropriate at their list price for the items. You however are free to spend that on whatever you want in those stores. Needless to say the insurer doesnt pay £1,000 for a £1,000 gift card.