Brits could be undervaluing their contents by £115bn
Each home in the UK could be underinsuring their possessions by more than £16,000, according to Admiral Home Insurance.
A survey by the insurer asked people to estimate the value of all contents in their home. The average figure came out at £18,333 – £16,667 less than the average contents value of £35,000.
Across the UK that works out at a total of £115bn worth of contents that could be undervalued.
While two-thirds of respondents (67 per cent) typically update their contents insurance on an annual basis, just under a quarter (23 per cent) said they didn’t think it was necessary to increase their insurance level regularly, for example when they buy a high-value item such as jewellery or home technology.
Contents are defined as everything from a wardrobe of clothes, to pots and pans, to any gadgets owned. Anything not fixed down in the home is covered by contents insurance.
This large disparity between the perceived contents value and actual value becomes even more alarming as more than a third (36 per cent) revealed their contents were at risk in some way, whether from burglary or flooding.
Home contents estimates are higher by men than women, with men averaging £19,820 compared to women at £16,953. But both figures are dramatically lower than the national average – meaning possessions could be under-insured.
Sharers less likely to have contents insurance
When it comes to property types, people living in a rented, shared flat were the least likely to have insurance; more than half (58 per cent) of flat renters said their contents weren’t covered at all.
They also undervalued their contents by the most at just £7,717 – more than £27,000 under the national average. This is despite the fact they’re the most likely to feel their contents are especially at risk of theft or damage (58 per cent).
Noel Summerfield, head of household at Admiral, said: “It’s important homeowners or renters provide an accurate estimate for their contents, otherwise they could end up without enough cover if they need to make a claim.
“The value of most items can be searched on the internet, but antiques or jewellery should be valued by a professional before being added to your policy. Seven out of 10 people said they feel attached to the items in their house, so getting the right level of cover is especially important if you think your contents are at risk in any way.
“While some people update their cover annually, some forget to amend their policy when they buy or receive high value items (worth over £1,000) – think Christmas, birthdays and anniversaries. Our research reveals a quarter (25 per cent) wouldn’t inform their insurer and add them to their policy, with a further 51 per cent not planning to do this at all.”