Disaster lessons: make sure you don't underinsure

Published by Mark King on 05 March 2015.
Last updated on 05 March 2015

Home insurance

However, its research suggests the true value is closer to £55,000. Here are our tips for making sure you do not underinsure:

  • Even if you think you do not own items that thieves would want to steal, remember that contents insurance also covers perils such as flooding and fire, which is why it is important to include all items
  • Check how an insurer defines contents and buildings. Items such as carpets and contents in the garden may also be included under the policy contents. Do not forget items that are not used every day but are still valuable - for example, jewellery
  • Each year the value of your contents will change, so make sure you adjust your cover accordingly. Remember that the total sum of your insured contents should reflect the replacement cost of items at today's prices - not the amount you paid for them
  • Don't forget to include items such as kitchen utensils, bathroom towels, bed linen and even those items stored in the loft – the cost of replacing these items can all add up. The insurer will add them up in the event of a major claim, so you should too
  • Use a contents calculator to add up the value of your contents in each room, including furniture. Direct Line has one at: directline.com/home-insurance/buyers-guides/contents-calculator.


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Disaster advice

You may not always get compensation for personal injury and, if you do want to go down this route, you may well have to take legal action. Citizens Advice has the following helpful advice:

  • You might want to claim compensation because of: an accident at work; a traffic accident; a mistake during medical treatment; you have had an accident in the street, in a shop, or in some other public place; you have a psychological illness suffered because you were abused as a child
  • You might be able to claim general damages and special damages. General damages are paid as compensation for an injury (a payment for pain and suffering or loss of future earnings), while special damages are paid as compensation for actual financial loss caused by the accident up to the date of the hearing.These can include damage to clothing or other belongings, the costs of care, travel costs to hospital, medical expenses (including the cost of private treatment) and the cost of hiring and/or repairing a car if it has been damaged in the accident
  • The most common claim in a personal injury case is negligence and the legal time limit for this is three years
  • In most cases you cannot get financial help (legal aid) to claim compensation for a personal injury, and you will need to pay expensive legal fees upfront, which you are unlikely to get back if you lose your case
  • If you are unable to get legal aid, or do not have an insurance policy to cover your claim, one option is to enter into a 'conditional fee' or 'no win, no fee' agreement with a solicitor
  • If you enter a 'no win, no fee' agreement, you won't have to pay your solicitors' fees if you lose (although you may still have to pay some expenses). If you win, you will have to pay your solicitors' fees and these will be much higher than if you lost your case
  • You should think very carefully before entering a 'no win, no fee' agreement as, win or lose, you may still have something to pay, and this can often be much higher than you might expect.

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