Is my insurance company right (UK)?

Question

I had student's possessions insurance with Endsleigh. I paid an extra premium to insure my laptop for £1000 (which was the brand new value 3-4 years ago). The laptop got damaged whilst travelling and I sent it off for repairing on the insurance. They said they could not repair it and offered me a replacement worth £700.

I was not happy with this as I had insured it for £1000. May I add that the people who fix/repair is a different company (Lakeside). Lakeside said it was £700 as my laptop had devalued during the time I had owned it. I explained how I had paid the extra premium but neither Endsleigh or Lakeside want to know.

How did Endsleigh let me insure it even though they knew it was devaluing.... the way it was explained to me was that I would get what I paid for (£1000)... how can they get away with this????? I'm furious! Has this happened to anyone else?

Is there a way I can make them get me what I paid for?

Answer 1

When you insured the laptop it would've cost £1000 to replace. However during the course of time that exact same laptop now only costs £700 to replace. Therefore the maximum you will receive for the claim will be £700. Were you to receive £1000 this would enable to either buy a better spec laptop or buy the same laptop and keep the £300 difference. You can not make a profit on the claim which is what you would essentially be doing were you to be paid £1000 - that would be a form of fraud.

Answer 2

I was in the same situation with endsliegh student insurance, having my £1500 laptop replaced with an £800 new one! there so over priced and service is appalling, they offer you what something of a similar spec would cost now not how much it was worth then so your not losing out too badly. Id highly recommend shopping around when it comes up for renewal though check out the advantage section on this site and get a quote!

Answer 3

I don't think you'll get anywhere trying to get them to pay out more. The way they work it out is that you can get a replacement of the same or better spec for less money today.

When you originally took out the insurance it would have cost £1,000 to replace.

Answer 4

Your policy is there to put you back in the same position as you were before the loss/incident, or as near to that position as possible.

If it only costs, say, £700 to replace your laptop with a like-for-like one then any additional payment would put you in a better position that you were before the loss.

Answer 5

Insurance companies are only too willing to take your money and then wriggle out of paying claims.

With a normal insurance policy, you can only cover your financial loss at the time.  If your laptop cost £1,000 3 years ago, a second hand one with the same spec now would cost you about £300 - so they are being unusually generous for an insurance company.  See what you can find on eBay for £700 and you'll finish up with something a lot better.

It is possible to get "new for old" insurance, but not normally for computers.  Yesterday's "State of the Art" is today's bargain basement.

Answer 6

Well look at car insurrance, they do not offer what you paid for the car, due to depreciation.

So what is the difference.

Answer 7

The insurance company is correct.  The £1000 was the sum insured, which is the maximum amount you would ever get for a claim, it doesn't mean you will definitely get £1000 if you claim for a new laptop.

Prices of computers have come down a lot recently.  Even though you paid £1000 for your laptop 3-4 years ago, it is now possible to get an equivalent one for much less.  If they gave you £1000 now, then you would actually be better off than you were before the laptop got damaged.  

The purpose of insurance is to put people back into the same financial position that they were in immediately before the incident occurred - no better or worse.

So you can rest assured that no-one is trying to rip you off. :)

Answer 8

I bought a 2nd hand laptop for £600.

3 years later it got damaged and my 'new for old' home contents insurance got me a brand new laptop that was retail price at £1000.  (far better than my old one) and included a free three year parts manufacture warranty.

Did your policy state 'new for old'?

I was paying around £11 per month for my home content's insurance.

Answer 9

Unfortunately that's how insurance companies work and make their large profits. They take your premiums, then when you make a claim they do their utmost to avoid paying out, they will find every loophole going to avoid paying you what is due.

Answer 10

The price of laptops has come down over the last couple of years. Even for £700 you will get a better spec laptop now than the one you paid £1000 for 2 years ago.

xx

Answer 11

Complain to the company in the first instance and then if you are still not happy complain to the insurance ombudsman.