Contents Insurance and Underinsurance

🧾 Valuing Your Contents

Go Room by Room

The reliable way to value contents is to walk through each room and total what it would cost to replace everything. People consistently underestimate, because a houseful of ordinary items adds up to a surprising amount.

Replacement Cost, Not Second-Hand Value

Most policies are about replacing items with new equivalents, so value what it would cost to buy them again, not what they would fetch second-hand. That difference alone explains a lot of underinsurance.

High-Value Items

Jewellery, art, collectibles, bikes, and similar high-value items often have a per-item limit unless you list them specifically. If you own valuable single items, check whether they need to be named on the policy to be fully covered.

Our Contents Sum Insured Calculator helps you build a room-by-room total.

📉 Why People Underinsure

The Underinsurance Trap

If your sum insured is below the true replacement value, a large claim will not fully cover replacing your contents. People underinsure mainly because they guess low and never update the figure as they accumulate more over the years.

It Creeps Up Over Time

Contents grow quietly: new appliances, more electronics, a fuller wardrobe. An accurate figure from five years ago can be well short today, so a periodic review matters.

💡 Renters and Common Mistakes

Renters Need It Too

Renters often skip contents insurance, assuming the landlord covers things. The landlord covers their building and their property, not your belongings. A fire or burglary could wipe out everything you own with no cover.

Common Mistakes

Mistake 1: Guessing the Sum Insured

A round-number guess is almost always low. Count room by room instead.

Mistake 2: Valuing Second-Hand

Insuring for what items would sell for, rather than cost to replace, leaves a gap on most replacement policies.

Mistake 3: Not Listing High-Value Items

Jewellery and similar may be capped per item unless named. Check the limits.

Mistake 4: Renters Going Without

Assuming the landlord covers your contents is a costly mistake; they do not.

A Simple Approach

See our Insurance Basics guide for the fundamentals. Final word: contents insurance protects your belongings, for owners and renters alike, but only if the sum insured reflects their true replacement value. Count room by room, name high-value items, and review the figure as your contents grow. This is general information, not advice; check your policy wording and limits.