Home insurance for your computer

Have you fallen into the underinsurance trap? Research shows that an estimated 13.6 million homes in the UK have done just that. The longer you live in your home, the more likely it is that the value of your contents will increase. If you want to get optimum protection and peace of mind from your Direct Line Home Insurance cover, it's your responsibility to update your sum insured.

What exactly is underinsurance?

If you haven't declared the full value of your contents under your home contents insurance policy, you need to ensure you have adequate cover as soon as possible. If you have £45,000 of contents, but only £30,000 of cover, you would not receive the full replacement cost of your contents in the event of a claim. Plus, as your lifestyle changes – you earn more money, buy your own house, get married or start a family – the actual value of your contents can rise in to tens of thousands of pounds rapidly. It's important to remember that if you take out Direct Line House Insurance, the onus is on you to update your policy when necessary.

The major pitfalls

It's easy to overlook the full value of your contents because a rise in the amount of your contents usually happens at the most exciting times of your life. If a partner moves in with you, for example, that will usually increase your contents value. Similarly, if you start a family, the items you buy for your child can considerably add to the value of your assets – one study even estimates the average toy box at around £700!

One of the most common times of underinsurance is at Christmas, when you are likely to fill your home with expensive presents and not build this into your policy. Even after Christmas, the chances are that the expensive i-pod or computer console you bought was for someone in your family and therefore will stay on your property.

Direct Line home insurance can help alleviate this pressure with an automatic 10% increase in cover for several weeks on either side of Christmas (and family weddings). Direct Line can also advise on providing adequate cover while you are in the process of moving home.

Managing your policy

The best way to combat the common problem of underinsurance is by taking a comprehensive contents inventory, carefully listing each item you own under easy to reference categories. Keep receipts of any new items you buy, as you will be asked for documentation if you need to make a claim. As Direct Line operates a ‘new for old' policy, you should also take into account the depreciation of your contents over time and insure their replacement value, rather than their resale value – if in doubt, a quick call to Direct Line can help sort out any underinsurance queries.

Taking out extra Personal Possessions cover can also help, in the run-up to Christmas for example, when you may decide to store special presents away from home or transport them further afield. Direct Line can also advise you on ways to improve your home security to protect valuable contents. If you do need to make a claim, it needs to be reported straight away. Plus, to help you stay covered year on year, it's easy to renew your policy every 12 months online.

For more details on keeping your Direct Line Home Contents Insurance policy up to date see our policy document or policy summary.

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Things you need to know about Over 50s life insurance:
Premiums stop after your 90th birthday but you still enjoy cover for the rest of your life. In the first year, if you die from natural causes we will refund any premiums, or if you die as a result of an accident, we will pay your cash sum. After the first year regardless of the cause of death we will pay your cash sum. Depending on how long you live, the total sum paid in premiums may be more than the cash sum payable on death. If you stop paying your premiums before the end of your policy your cover will stop 30 days after your missed premium and you won’t get anything back. This isn’t a savings or investment product and has no cash value unless a valid claim is made. Inflation will reduce the buying power of your cash sum in the future.

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