May 9, 2011 by Canadian Underwriter
New research by specialist home and contents insurer Hiscox reveals that 60% of 715 high-net-worth homeowners surveyed in 2010 underestimated the true value of their possessions, leaving them at risk of being underinsured.
“In Hiscox’s experience, many homeowners are surprised when they discover the value of the things they own,” the insurer notes in a statement on its Web site. “Many have not considered the items they have accumulated over the years, items inherited or fluctuations in the value of jewellery, art or antiques.”
Despite these findings, 67% of 505 U.K. high-net-worth homeowners in a separate study expressed confidence they knew the value of their home and its contents – a “confidence likely to be misplaced in light of Hiscox’s own findings,” the insurer notes.
Commonly, people tend to forget about price changes. Items such as jewelry, for example, may increase or decrease based on the cost of materials. They also tend to neglect to take into account aggregation of items or the upgrading of items.