Personal Belongings Replacement Cost.

skymole

Ok - so I understand that this will vary from policy to policy.
The policy is a household all risks policy including personal belongings.
I have searched through the policy wording and have found no mention of the way they would settle a claim. I emailed and asked if the item (Apple Watch) would be settled on a equivalent model basis if the original model was no longer available. This was the reply: "Yes if the model is not available you will be offered a settlement based on the nearest equivalent of the model that has been lost"
However the original purchase was highly discounted as part of an incentive for a subscription.
They have now made me an offer based on the original purchase price and not the replacement cost.
Surely this is irregular?
As I say I realise that the settlement basis will vary from policy to policy, but in the absence of any clarification in the wording I would expect it to default to some sort of industry standard.
Any advice would be appreciated...
Many thanks..

DullGreyGuy

Do you have a link to the policy book? It'd be very unusual for it not to have clauses on how claims are settled.

CSI_Yorkshire

It's not massively irregular - you can't just buy something at 50% off and then get double the cash from the insurance automatically.

It should all be described in the paperwork.

skymole

DullGreyGuy said:

Do you have a link to the policy book? It'd be very unusual for it not to have clauses on how claims are settled.

Hi Yes this is the link..
https://www.coveainsurance.co.uk/media/2861/p97q-profile-policy-wording-06-19-final-v3.pdf

skymole

CSI_Yorkshire said:

It's not massively irregular - you can't just buy something at 50% off and then get double the cash from the insurance automatically.

It should all be described in the paperwork.

Hi, thanks for your reply.
I understand your logic, however, in this instance the discount related to an incentive scheme to with a health insurance provider. So I did end up paying for it in a round about way by paying the qualifying insurance premiums.

The way I look at it is:
If I had been paying into a lottery scheme and had one week struck lucky and won a bicycle, I would be disappointed to find that my insurer refused to pay out because the bike was free.

So in the normal way I would expect an insurer to pay the reasonable cost to replace the item.

If I had insured a camera which cost me £300 for example, but when I made a claim, the same or equivalent model could be purchased for £200, I would consider it reasonable for the insurer to base the settlement on the £200 replacement cost. By the same token, if the replacement value had increased over time, I would expect the settlement to reflect the actual replacement cost.

But I understand that my expectations and actual practice may be very different...

CSI_Yorkshire

skymole said:

CSI_Yorkshire said:

It's not massively irregular - you can't just buy something at 50% off and then get double the cash from the insurance automatically.

It should all be described in the paperwork.

Hi, thanks for your reply.
I understand your logic, however, in this instance the discount related to an incentive scheme to with a health insurance provider. So I did end up paying for it in a round about way by paying the qualifying insurance premiums.

The way I look at it is:
If I had been paying into a lottery scheme and had one week struck lucky and won a bicycle, I would be disappointed to find that my insurer refused to pay out because the bike was free.

So in the normal way I would expect an insurer to pay the reasonable cost to replace the item.

If I had insured a camera which cost me £300 for example, but when I made a claim, the same or equivalent model could be purchased for £200, I would consider it reasonable for the insurer to base the settlement on the £200 replacement cost. By the same token, if the replacement value had increased over time, I would expect the settlement to reflect the actual replacement cost.

But I understand that my expectations and actual practice may be very different...

That's pretty much it - it's not automatic, it should be sensibly assessed according to the terms of the policy.

Some are very generous in what they say is "equivalent" - i.e. if you bought top of the range then, you get whatever is top of the range now in replacement.

Some are not so much - if your old camera was 5MP, you would get one that is 5MP even if technology has moved on.

Plus the usual "we'll pay you whatever it would cost for us to buy it from our supplier", which catches some people out.