Legal and General launches online home contents calculator

Although we appear to be aware of the value of our homes, particularly as house prices are falling across the UK, Brits are worryingly not very good at valuing the actual contents of their home.

Legal & General recently surveyed over 4,000 people as part of the Changing Face of British Homes research which revealed that 15% of Brits have no idea how much it would cost to replace the contents of their home.

Although Legal & General has calculated that the average value of the contents of a house is estimated to be over £40,000, the survey highlighted that the majority of us, 59% estimate that the cost to replace the contents of their whole home would be below £40,000. Plus over a quarter, 27% valued their contents at less than £20,000, so possibly 100% less than their cover should be.

This would suggest that Brits could be seriously undervaluing the contents that we have in our homes and as a result under-estimating the insurance cover they actually need.

So to help customers, Legal & General's general insurance business has developed an online calculator in the form of a 3D virtual home which enables customers to ‘tot up' the value of their possessions, room by room. It is hoped that by using this service customers will be able to place a more accurate valuation on their contents and as a result help ensure they have a realistic level of household contents insurance cover in place. The calculator is available at legalandgeneral.com/contentscalculator

Garry Skelton, Marketing Director for Legal & General's general insurance business said: "Many of us seem to be seriously under-estimating the value of the contents of our homes. Obviously every home is different and so the online calculator has the flexibility for customers to enter amounts that are appropriate to them and so help to provide a more personalised valuation. Our customers can then be confident that they can arrange for the appropriate level of home contents insurance cover to be in place and so not risk being underinsured."

Legal & General's Changing Face of British Homes research revealed that when asked to put a value on the contents of their homes room by room the values estimated were again lower than perhaps they should be. For example, the average value quoted for the contents of a living room was just over £6,000, yet Legal & General has estimated that the value of the contents could be closer to double that amount, at nearly £11,000.

The value estimated by those surveyed was consistently lower than the probable replacement value as calculated by Legal & General. So although we may believe we have adequate cover in place, in reality because we are undervaluing our contents, we probably need a higher level of home contents cover.

Those aged between 18 and 24 who estimated that the contents of their homes at just under £27,000, 18% below the average estimate of over £33,000 and;

Those people living in Yorkshire, who on average estimated the contents of their home to be worth just over £31,000, 6% lower than the estimated average of over £33,000.

The simple to use room by room inventory in the home contents calculator, will help to ensure that a more realistic ‘total' value of a home's contents is established.

Garry Skelton continued: "If there is a significant gap between the level of cover and the actual replacement cost of the contents, customers could be very disappointed if they ever did need to claim, as the amount paid may not be sufficient to replace their belongings.

We recommend that everyone reviews what items they do have covered under their home contents insurance and their replacement values on a regular basis."

Garry continued: "We remember to Include major items like a sofa, bed or TV and ‘high risk' items, such as jewellery and art, but it is surprising how quickly the value of the less obvious items, such as clothes, bedding, gadgets or a CD collection for example, can add up. And then don't forget items stored in a garage or an attic.

In addition, where customers have valuable items, such as pictures or works of art, they should arrange for a professional valuation of the replacement cost of that item, so this may also be factored into the total cover required."