Prevent underinsurance: importance of valuation of valuables

With contents insurance, you are insured against damage to your possessions inside and around your home. For valuable items, this coverage is sometimes insufficient, which can lead to underinsurance. A suitable solution is the valuables insurance. A regular valuation of your valuables is very important here. When the value changes, you need to report this adjustment to your insurer.

Regular contents insurance has limitations in coverage. This is especially true for valuable objects, such as jewelry, watches, art, musical instruments, high-end audio equipment and elaborate golf equipment. Standard insurance policies often have maximum coverage, for example, up to €5,000 for jewelry. If you own valuable watches, standard insurance may not provide adequate protection.

Power of valuables insurance

Valuables insurance covers theft, loss, destruction and damage to your most valuable possessions. This insurance can supplement your household contents insurance. It is essential to check that the additional coverage is valid outside the home for your valuables, such as jewelry and musical instruments that often travel with you.

Although valuables insurance policies provide comprehensive protection, there are exceptions. It is advisable to read the policy terms carefully to understand what is and is not covered. Some common exclusions include normal wear and tear, damage from improper repair or maintenance, and damage caused by floods, earthquakes or acts of war.

A detailed valuation report

When purchasing valuables insurance, the insurer must be aware of the value of your possessions. A professional appraisal provides the most accurate indication of this value. With a thorough appraisal report, you can determine the appropriate insurance coverage. It is important to note that the maximum insured amount per category can vary greatly between different insurers.

An appraisal report is not only useful when buying insurance. The value of valuable possessions, such as antiques and art, can increase over time. Periodic appraisals help prevent underinsurance.

Impact of underinsurance

Underinsurance occurs when the insured value of an object is less than its actual value. This results in partial coverage of the object. Imagine your household contents are insured for € 70,000, but the actual value is € 80,000. For a damage of € 10,000 after a kitchen fire, you will receive only € 8,750 compensation due to underinsurance, since 12.5% is not covered.

Do you own valuable items? A valuables insurance policy guarantees protection against damage and theft. Remember to review the terms and conditions carefully, including any requirements regarding security of your home and valuables themselves. For more information, read this article.