A simples guide

How to estimate the total value of your possessions

When you apply for contents insurance to insure your personal possessions against loss and theft, the insurance provider will want to know the total value of all your possessions. Here we look at how you might go about doing this.


What valuables to include in the estimate

Essentially, all your valuables should be included in the estimate. However, when you estimate the value of your possessions, you should not just count up the value of your most precious items – you actually need to work out the total value of all your possessions that you store at home.

You need to include everything, not just items that a burglar might want to take away. Contents insurance is also designed to protect you should you lose everything in a fire and you then need to replace everything you owned.

The only things you can leave out of the calculation are the fixtures and fittings that are covered under a buildings insurance policy. Fixtures and fittings include the walls, windows and roofs of your property, plus anything that is secured in place, such as wardrobes, fitted kitchens and bathroom suites and units that are secured to the wall or floor.

Curtains, carpets and flooring are usually covered by the contents insurance policy rather than the buildings insurance policy.

The best way to ensure you don’t miss anything is to move from room to room in your home, making a list of everything in that room that would be classed as one of your possessions. For example, you would need to include the following:

  • Furniture – including lamps, cabinets, sideboards and bookcases as well as sofas and chairs
  • Artworks and antiques
  • Electronics
  • All cooking equipment – the oven, microwave, kettle, toaster etc.
  • The fridge and freezer
  • The food stored in the freezer and cupboards
  • Kitchenware, such as pots and pans
  • The washing machine and tumble dryer
  • The dishwasher
  • Bedroom furniture and linen
  • Cutlery and crockery
  • Books
  • Clothes and shoes
  • Your record collection
  • Children’s toys
  • Jewellery and similar items
  • Cosmetics and toiletries
  • Garden furniture and equipment
  • Items stored in sheds or other outbuildings, such as bicycles and play equipment


How to calculate the prices of items

Calculating the price of individual items may not be easy, but the best advice is to do some research as to how much it would cost to buy each item if you were to want to make a purchase right now.

When you estimate the value of your possessions that you need to insure, you need to calculate the value of each item listed above, plus anything else you own that would be classed as part of your household contents, and then add up the total.

Remember that the value of an item for insurance purposes is the amount of money it would cost to replace the item today, which is unlikely to be the same as the price you paid for it.
Make a special note of anything that is especially valuable, say with a value of more than £1,000, as these items may need to be insured separately. Most contents insurance policies have a limit on the amount that can be claimed for the loss of a single item.

Have your valuable items re-valued on a regular basis, to ensure your insurance policy remains adequate to cover them. Some items, especially rare and collectable items, can increase significantly in value over time. The value of gold and other precious metals can also go up and down, thus affecting the value of your jewellery. If an item increases in value, but you forget to update your insurance policy, then you will only be covered for its declared value. It’s advisable to get a valuation certificate that’s generally less than three years old so in the event of a claim you have an up to date value.

How accurate does the estimate need to be?

The estimate needs to be as accurate as you can possibly get it. If you over-estimate the value of your possessions, then you will end up taking out more insurance than you need and you will therefore be wasting money paying a premium that is too high. An insurance provider will never pay out more than the actual total value of your possessions.

If you under-estimate, then you could find that the payout you receive does not cover the full amount of your loss. This is because insurance providers will reduce any payout by the same degree to which you underestimated the value of your possessions.

For example, if you estimated the value of your possessions at £20,000 when in fact it was £30,000, then the payout on any claim would be reduced by a third. So if you suffer a loss of £3,000 and claim for this amount, then the insurance provider will only give you £2,000.
It has been estimated that one in four UK households is under-insured.

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