Contents Insurance

This post follows from my last post on insurance. It was my situation with contents insurance that inspired me to write the original article.

This post follows directly on from my previous post. In fact it was the content of this post that inspired my current views in insurance as a whole.

What student insurance?


After living in Birmingham for my University and renting as a student for three years, I moved to London following a job offer. I now rent a fully furnished flat with three others.

I have few possessions: clothes, kitchen crockery, cutlery and cooking equipment, a second hand HD tv, a laptop, and a phone (that pretty much remains on my person at all times). In all it would probably cost a generous estimate of £2,000 to replace it all.

Being the concerned folks that they are, my parents were horrified to discover that I had no contents insurance for my possessions in the case if theft or damage of my possessions.

Being the respectful son that I am I searched on no less than 4 price comparison websites. The best deal that I managed to find was for £227 per annul. This price was under the assumption that the minimum net worth of my possessions was £5000. I must point out that this was the minimum that any comparison site would allow me to state. Given that the aggregate value of my possessions was £2000, this price for insurance represents over 10% of my contents.

Never needed contents insurance


I opted not to buy any contents insurance. This is because I reasoned that in my area I was not likely to be burgled. Furthermore if I was unlucky enough to be burgled just once in 10 years I would have lost out. This is because if I had insurance and was only burgled once in 10 years, I would have ended up spending more on insurance than I would ever have had paid out in claims. It's a sad situation where I NEED to be burgled a few times to get paid back. Furthermore, having been burgled my annual premiums would increase.

As a result of this calculation I have reasoned that until my contents are worth far more than £5000 it is not worth the money for me to buy contents insurance.

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1 comment

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