How to value old and/or discontinued items for Home Contents Insurance?

Tunstallstoven

Hi all

I'm having a tot up of my contents and getting quite confused as to how to value some of them.  I wondered if anyone could help please?  Seems I get more sense on this forum than asking the insurers directly!  

Here's some examples...  

- TV.  A 42" Panasonic but around 15 years old.  So probably not worth much as old technology etc.  Would it still be new for old, even though a new replacement would be so much better tech wise?

- PC.  Similar to the TV.  I built it myself 15 years ago for well over £1,000.  Reasonably top spec back then.  But by today's standards it's a bit of a banger.  How to value?

- Guitars.  Bit more of an anomaly this... I've got some rare-ish, but not hen's teeth rare guitars, all of which are discontinued.  If they were to need replacing, I would prefer to seek out direct replacements, which would mean finding them secondhand.  They're probably worth a little more secondhand now than the original RRPs (not accounting for inflation).  How would the insurers view this and would they insist on replacing with equivalent new models?  As for value, should I value them at the RRP, the price I paid, or the secondhand price they fetch now?  

Any help most appreciated

Many thanks

Brie

When I was looking at what cover we needed I went room to room and came up with a figure of how much it would cost to go out and buy everything new.  So PC & TV would be what you'd pay to replace with something current from Currys or wherever.  Guitars, like anything that isn't replacable as new, i.e. antiques, paintings, vinyl..., could be valued using ebay or similar.  

Always amazed at the number of people who don't have contents insurance on the basis that they don't have anything of value.  Not thinking of course of how much it costs to replace all the basics like towels and several changes of clothes etc. 

Tunstallstoven

Thank you, that all seems to make sense   

So I guess a camera would fall into the same as the TV and PC?  Around £1,000 new but nowadays worth no more than £200.  I'd still value it at the original £1,000 as that's what it would cost to replace with the modern equivalent from Currys etc?  

Thanks again

DullGreyGuy

Tunstallstoven said:

- TV.  A 42" Panasonic but around 15 years old.  So probably not worth much as old technology etc.  Would it still be new for old, even though a new replacement would be so much better tech wise?

- PC.  Similar to the TV.  I built it myself 15 years ago for well over £1,000.  Reasonably top spec back then.  But by today's standards it's a bit of a banger.  How to value?

- Guitars.  Bit more of an anomaly this... I've got some rare-ish, but not hen's teeth rare guitars, all of which are discontinued.  If they were to need replacing, I would prefer to seek out direct replacements, which would mean finding them secondhand.  They're probably worth a little more secondhand now than the original RRPs (not accounting for inflation).  How would the insurers view this and would they insist on replacing with equivalent new models?  As for value, should I value them at the RRP, the price I paid, or the secondhand price they fetch now?  

TV - based on a basic 42" new tv

PC - based on a basic desktop computer with, as far as possible, similar ram, HDD capacity etc

Guitar - really depends on how they are described... you bought it as a brand new fender telecaster they'd probably just replace it with a new telecaster so value as that. If you bought a Fender Coronado II then this is much more of a discussion... it could be valued at its current secondhand price, it could be at its last known RRP or at the value of the nearest equivalent model available new today. It depends on a combination of the terms of the policy and your ability to demonstrate it had appreciated in value. For setting the policy value just choose the highest of the three

Luke451

Tunstallstoven said:

Thank you, that all seems to make sense   

So I guess a camera would fall into the same as the TV and PC?  Around £1,000 new but nowadays worth no more than £200.  I'd still value it at the original £1,000 as that's what it would cost to replace with the modern equivalent from Currys etc?  

Thanks again

I think that you should add a bit more than 1000 actually... The class where that item belongw may be the same, but you know, the worldwide GDP has grown and things are always more expensive, and I've seen many companies, especially for electric items, to increase the price quite a lot compared to 10-15y ago.

As a paradox, it happened also when Intel released the first I3-I5-I7 in 2008 if I remember well, just to give a quick example, they were supposed to deliver a new experience with performance, but the price difference was visible worldwide I believe, same with iPhone.

Plus, if you over insure the house content, it's always better, if you under insure, you'll have problems...

I personally declared much more than I have, and with the time, I may always add more expensive items, and I can't remember every time to check again my tight house content insurance...

I also took item insurance outside home, like phone, PC etc, because that amounts at several thousands!

Tunstallstoven

Thank you both for the replies, that's really helpful info  

Luke451

Just to give you more info, I made sure of 3 things:

1. Over insure, not 100k more, but considerably more, otherwise the insurer may insinuate that you declared less to get less monthly fees, and you may be denied a big part of the claim. There is an interesting video on youtube that talks about it, I just can't find it at the moment .

2. The items that are very expensive and need to be manually specified, make sure you insure them with a considerable higher amount. For example, my MacBook costs several thousands, but in 7y distance, it may cost 300-400 more to be replaced as new + inflation.

Of course it will have more RAM, more cores and more storage probably, and there is also inflation.

The point is that instead of 3000, it may cost 3500...

Plus, if I remember well, partial claim can't be covered, they are not gonna give you 3000 pounds for a 3500 pounds laptop in 2030, but this may vary between providers.

3. Save ALL the invoices

DullGreyGuy

Luke451 said:

Just to give you more info, I made sure of 3 things:

1. Over insure, not 100k more, but considerably more, otherwise the insurer may insinuate that you declared less to get less monthly fees, and you may be denied a big part of the claim. There is an interesting video on youtube that talks about it, I just can't find it at the moment .

2. The items that are very expensive and need to be manually specified, make sure you insure them with a considerable higher amount. For example, my MacBook costs several thousands, but in 7y distance, it may cost 300-400 more to be replaced as new + inflation.

Of course it will have more RAM, more cores and more storage probably, and there is also inflation.

The point is that instead of 3000, it may cost 3500...

Plus, if I remember well, partial claim can't be covered, they are not gonna give you 3000 pounds for a 3500 pounds laptop in 2030, but this may vary between providers.

3. Save ALL the invoices

1) Its prudent to add a buffer, people just don't realise what the total cost of their wardrobe is or small gadgets etc in their kitchen and make the mistake of just adding up the big ticket items. The value insured has to be your complete contents not just the big items

2) There is no need to add for future inflation in this years policy, next years policy will be index linked other than for specified items. Part claims will be covered, so if you are under insured you get averaging applied (claim settled down by the percent under insured) but you don't receive nothing as Luke suggests. 

You do want to check what the unspecified item limit is though as they can vary from £750 to £15,000... one thing switchers fall foul of is getting a cheaper policy not realising they've a lower item limit and failing to add the items above that limit to the policy.

3) Save material invoices... you don't need to save your receipt from the emergency bottle of milk from the cornershop etc

Tunstallstoven

Great - thanks for the additional info.  

I did check whether over-insuring is ok and was told that it is.  So it's good to hear from you guys that it's not only ok to do it, but recommended.  

In a sense I guessed it must be ok as most insurers only offer a small handful of "packages".  IE -

£500k buildings / £50k contents
£750k buildings / £75k contents
£1m buildings / £100k contents

If you weren't able to over insure, then in most cases none of the options would actually be applicable.  IE - if you needed buildings insurance of £1m but only had £50k contents...  

Ta

DullGreyGuy

Tunstallstoven said:

Great - thanks for the additional info.  

I did check whether over-insuring is ok and was told that it is.  So it's good to hear from you guys that it's not only ok to do it, but recommended.  

In a sense I guessed it must be ok as most insurers only offer a small handful of "packages".  IE -

£500k buildings / £50k contents
£750k buildings / £75k contents
£1m buildings / £100k contents

If you weren't able to over insure, then in most cases none of the options would actually be applicable.  IE - if you needed buildings insurance of £1m but only had £50k contents...  

There are two ways home insurance premiums can be done... "sum insured" or "bedroom rated". In the later they give a suitably high blanket limit and instead calculate the premium on an estimate of the size of your property, traditionally this was done on a count of the bedrooms, hence the name, but more often these days insurers ask about the number of other rooms too. 

Generally if you have more stuff/rebuild than the average person with your size property then this bedroom rated works well whereas if you have a lot less than the average 4 bed then you may find sum insured is better for you. 

The one thing to still check is the inner limits like high risk items or single article limit, some bedroom rated policies have a great headline cover (M&S Premier is unlimited cover for example) but don't necessarily have equally generous inner limits.