The phrase ‘I don’t need that valued as I have the receipt’ is something I regularly hear from my clients. And on the face of it, that sounds logical, especially if it’s a relatively new purchase. Sadly a receipt only shows what was paid and not the current market value. Things change quickly in the world of watches and jewellery, so you could find that any insurance replacement figure based on what you paid could be leaving you short of cover.
A Breitling Navitimer B01 chronograph would have cost you £6,460 in October 2020; fast forward twelve months, and it now costs £6,550, an increase of £90 and 1.39%. An Omega constellation cost £7,690 last year, while today it’s £7,880, increasing £190 and 2.47%. And it’s not just watches; a round brilliant cut diamond set single stone ring in platinum cost a client £4,900 in December 2020, whilst today its around £5,100, £200 and 4% more.
‘But my policy is index-linked, my cover goes up, so I am OK’, is what I also normally hear. But index linking often does not cover ‘valuables’ such as watches and jewellery. Plus, such items often have to be individually specified on the policy, so we are back at the ‘price paid’ replacement value. Now some of you might be thinking, ‘yeah, but it’s only £90 or £200, I’ll just pay the difference’. But what if the difference is more? What if you are not in a position to cover that shortfall? That then begs the question, what is the point of having insurance in the first place if you have to spend your own money to replace something? And what happens if the settlement is declined because you’ve been deemed to have been ‘knowingly underinsured’? What then?
The only way to ensure you have sufficient cover is to have your valuables valued regularly. Be proactive so you don’t find yourself short of cover when you need it the most.
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