Insurance expert Brian Gilmour has the inside scoop
Some prized possessions are simply irreplaceable – but when push comes to shove, contents insurance is the next best thing. It’s a necessity of life, and all too often it’s set and forget – until the time comes when you actually need it.
Most insurance policies provide a blanket cover for your household items, but when it comes to things like heirloom jewellery, artwork, that new e-bike or expensive camera equipment, are your precious items really covered?
Brian Gilmour, a specialist in insurance for people over 50, says, “Probably not.”
He sees too many people getting caught out.
“It’s this stage of life when the mortgage is gone, so people start to buy those dream items – a beautiful new ring, some skis, an electric guitar.”
But, he explains, most policies have a limit to how much they’ll pay for any one item. So, what to do? Brian shares his expertise on how to ensure your policy has got your valuables covered.
Start with the things not covered
If you’re like most people, you’ll have forgotten to specify items like jewellery, valuable art, expensive outdoor equipment and tech gadgets. That’s because you’ve assumed they’d be covered under your contents policy.
This is where the devil is in the detail, says Brian. While these items might be insured the question is, for how much?
“The majority of insurance policies come with limits. For example, you might automatically have bike insurance up to $3,000 – but your e-bike might be worth a lot more than that,” says Brian.
Without adding it to your policy as a specified item, you run the risk of not being able to purchase a replacement if you need to. The other thing to take note of is whether your policy covers you outside the home. Some contents insurance policies only cover your belongings while they’re at home.
“Not much use if your heirloom necklace is stolen while you’re wearing it to a dinner party!” Brian says.
Keep a record
For a big-ticket item, Brian recommends keeping a record that you own it. If you ever make a claim, documentation showing that you had the item in the first place, and how much it was worth, will make for a speedy process.
Proof of payment is easy to establish with online banking, but it’s also a good idea to keep any relevant receipts tucked away – often stores will keep a record of your purchase too. Paper receipts don’t last long – and only clog up your wallet – so get the store to send you an email copy, or take a photo on your mobile phone. Brian’s tip for gifts and heirlooms:
“You won’t have receipts for these, but insurance companies will still want proof that you owned them, so take photos. Ideally, include a copy of the day’s newspaper in the shot, to date-stamp the image.”
Regularly update your cover
So what do you do after making a significant purchase, whether it be an e-bike, art, jewellery, or a dining suite? Even before you post that brag image to Facebook, call your insurance provider or broker, to make sure your new treasure is covered. Brian adds:
“Have your details ready, and ask to add the new item to your insurance schedule if it’s not already covered.”
Adjust your sum insured
It might not be enough to simply add a new item to your policy. If the value of the item is very high, like a $15,000 piece of art, you’ll need to increase the total amount – or sum insured – of your contents insurance policy.
The sum of your insurance policy needs to cover the replacement costs of all your belongings – old and new, says Brian.
“When you increase your sum insured, this will affect your premium – how much you pay each year,” he explains.
Keeping your valuables covered
Unlike a good bottle of red, your contents insurance policy won’t get better with age. Be aware there are some items which might have a limited amount of cover – or none at all – if they’re not added as specified items to your schedule.
Each time you make a significant purchase, keep a record and call your insurance provider to update your policy. Also, adjust your sum insured if needed.
Want assurance that your insurances are truly in order? Get in touch with Brian Gilmour – expert in insurances for people over 50.