Beware the danger of under-insurance


ROBERT Marshall, of Essex-based Trident Insurance, warns of the dangers of under-insurance.

Some people are prepared to take the chance and see what happens and may be very lucky, but the nature of insurance is that it helps replace objects, contents, homes( at a full rebuild price), cars and so much more at market prices that are damaged beyond repair or need compensation for the likes of cyber cover or business interruption.

Can you establish a replacement of a family item? Not always, because any replacement hasn’t the emotional attachment of Mum or Dad or a brother or sister. But it can help a lot if it’s been covered in the policy at the right price. When looking at what you pay for cover against the value actually many insurances are a steal on value for money.

In business, many may think it’s OK to undervalue stock but were there to be a break-in, or fire, or damage to the building – possibly caused by the next-door building – that ruined all the contents and stock and they were not valued fairly at market replacement prices, you may find the insurer either not paying out at all or only paying out a percentage of the value at best.

Business interruption is never thought of as an issue but think of how much you as a business subcontract what you do, from phones and the internet to electricity and gas and that’s just the start.

Comparison sites have changed the way we insure but it’s not just about price anymore and you can buy all sorts of cover on the net – but are you buying the right cover? Fake cover is just as bad as fake news and maybe a lot worse in some instances where it impacts.

You pay a lawyer or accountant to look after you and hope they do a good job. However, all your worldly assets, your company your medical care can be covered by insurance and, in short, if you pay peanuts you will get monkey polices which look good but offer little protection when you need it.

So please, when you insure, be they commercial or personal policies, treat insurance as a serious benefit that could save your company, replace your home, car, ruined holiday and so much more.

For sure we are not saying pay though the nose. We look after our clients. But remember under-insurance may look like a smart thing to do but it has serious downsides if you put in for a claim.

To put it simply you will not get £1 for 50p and that’s where you stand with underinsuring your home, business, car and family. For further advice, give us a call on 0800 038 9000.