State of the art gadgets with insurance that’s stuck in the past
optional extra so it is best not to just assume you are covered.
‘In addition, some insurers may expect you to specify the item on the policy to make sure it is covered and most insurers will set valuable item limits.’
Insuring gadgets on your home insurance can be affordable. Asda Money recently launched home insurance offering buyers the chance to vary cover depending on the amount of gadgets owned. It automatically insures your phone and other technology outside the home.
Increasing the technology cover with Asda’s home policy from £1,500 to £5,000 would cost an additional 26 per cent, raising the price to £120 a year from £95.
This compares favourably to stand-alone gadget insurance. Protect Your Bubble, for example, offers cover for four gadgets from £12.99 a month, depending on the items insured.
Kevin Pratt, head of insurance for comparison website MoneySuperMarket, says: ‘For some people
The excess for an iPhone can be £100
BRITISH families are being left high and dry when it comes to protecting their technology because the insurance industry refuses to move with the times. Exclusive research for The Mail on Sunday found that the vast majority of travel insurance policies have a single item limit way below the cost of an iPhone or other smartphone, while most home insurance policies only offer cover for items away from the home as an optional extra.
The other option for customers, specialist gadget or phone insurance, has been the focus of recent criticism from the Financial Ombudsman Service for failing to pay out in many cases.
‘There is a clear gap between the cover offered by insurers and the type of items that we now routinely take on holiday or have around the home,’ says Martyn James, head of media at the Financial Ombudsman Service, which receives many complaints about insurance companies failing to meet technology claims.
James says the typical limits on cover for baggage and technology have not changed for many years, despite the large amounts of expensive technology most of us own. Many families also take several smartphones on holiday, as well as tablet computers, Kindle e-readers and even work laptops.
‘Despite the technology we now take with us on holiday, and out and about in our daily lives, insurance policies have been slow to adapt,’ he says.
‘The number of gadgets – from mobile phones to tablet computers – that the average person possesses has increased dramatically recently. If you add that to jewellery, then it’s not unusual to be carrying around more than £3,000 in personal possessions,’ James says.
‘That in itself poses a challenge for insurers, which have to draw a line between what’s fair to pay out, when they should pay out and what responsibilities the individual has.’
Families are now left with a tricky balancing act when deciding how to insure their gadgets. They can increase the cover on their travel insurance, use their home contents policy or take out a specialist standalone policy. All three have drawbacks and advantages.
Comparison website Gocompare analysed the insurance policies on its website for The Mail on Sunday. It found that seven per cent of annual travel policies and six per cent of single trip policies provided no baggage cover at all. Most travel policies limited the amount customers could claim for a single item to between £200 and £300, half the cost of a wi-fi and cellular enabled iPad Air.
A quarter of single-trip insurance policies covered baggage only worth up to £1,500, half the £3,000 value mentioned by the Ombudsman, while 10 per cent covered baggage worth only up to £800. This research suggests that while customers can choose to buy more expensive addons to their insurance policies, or opt for secondary gadget insurance, the policies displayed on comparison websites are likely to exclude most of the technology many families use.
Caroline Lloyd, insurance expert at Gocompare, says: ‘Cover limits, excesses and exclusions for holiday baggage vary widely from one policy to another, so it’s essential you read the policy terms and conditions to find one with the level of cover you need – rather than just opting for the cheapest.’ She also recommends that people insure valuables on their home insurance rather than relying on travel cover.
But cover for valuables that are taken outside the home is likely to be an add-on to most policies, while those who claim are likely to face the loss of their no-claims discount on their entire home insurance if a gadget goes astray.
Lloyd adds: ‘Most home contents policies provide cover for personal possessions that are temporarily outside the British Isles, typically for up to 60 days. But it is usually an stand-alone gadget insurance or mobile phone insurance is the best option, especially if they don’t have a home contents policy they can use.
‘But the excess on these policies can be high, typically around £100 for iPhones, so again consumers need to weigh up the annual cost of cover and the excess levels before buying a policy or making a claim.
This protection is sometimes included in packaged bank accounts but be mindful of the cover levels in case it isn’t high enough to meet your needs.’
James at the Ombudsman says gadget insurance policies are becoming more consumer friendly as fewer claims are being turned down.
But anyone who believes a claim has been wrongly rejected should lodge a complaint with the Ombudsman. James says: ‘Sometimes it isn’t even a case of what is in the small print – we will also look at whether the small print is fair or not.’