Home Insurance Claims -
(New For Old)
Most policies (but not all of them) will
provide for replacement (contents) or reinstatement
Buildings claims generally do not provide much
problem here. The vast majority of buildings claims involve
repairs to the property and reinstatement means repairing with
new parts - which is what you would expect. It could be a
problem with a major claim where part or all of the structure
has to be demolished and rebuilt.
It is with contents claims that the issues
usually arise. Your policy says that if it can't be repaired it
will be replaced (within certain restrictions - see policy
cover). Insurers like to arrange replacement for you via their
supplier. This enables them to buy goods in bulk at wholesale
prices and thereby save a lot of money. They do not like it
where you want to replace the item or ask for cash instead.
In the first of these, your policy does not
restrict replacement to that provided by the insurer and if you
want to go out and buy the item yourself, you are entitled to
do so. But you will need to pay for it, obtain a receipt and
send this to the insurer for reimbursement. If you buy
something that is better or upgrade, then you have to pay the
cost of the upgrade yourself.
Where your insurer is arranging replacement and
you want to upgrade, talk to them. They will usually
accommodate this by asking their supplier to charge the
additional cost of the upgrade to you. You will benefit from
the discounts your insurers enjoy.
Where you want cash, insurers will now restrict
this to 'indemnity' settlement, not 'new for old' . They will
deduct wear and tear. But if the item was only a few months
old, or of a nature that does not depreciate much (e.g.
jewellery) it might be worth your while seeking a cash
settlement if that is what you want. Beware, however, that your
insurer might regard a request for cash settlement as a fraud
"When I saw I could not avoid a collision I stepped
on the gas and crashed into the other car."
|Extracts taken from actual claim
forms submitted to
a number of UK car insurance companies