Thousands of Brits could be in for a shock if they ever have to replace their home contents as, according to Legal & General, more than half under-estimate the value of their belongings.
As part of its Changing Face of British Homes research, Legal & General found that 15 per cent of Brits have no idea how much it would cost to replace the contents of their homes in the case of disaster.
As part of its research, Legal & General calculated that the average value of a home's contents is estimated to be more than £40,000. However, the study showed that 59 per cent of participants valued their home contents at less than £40,000, potentially resulting in a disappointing home insurance
In fact, Legal & General found that more than a quarter of people valued their home's contents at just £20,000, a miscalculation of as much as 100 per cent, which could leave a huge deficit on a home contents insurance claim. In response to this apparent error of judgement, Legal & General has launched a home contents insurance
calculator aimed at those who only guesstimate their insurance needs.
Gary Skelton, marketing director for Legal & General's 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 provide a personalised valuation."
The research found that those most likely to put their home contents at risk were aged between 18 and 24, who had an average self valuation of just under £27,000, 18 per cent below the average estimate of more than £33,000."
Warning of the dangers of under-estimating the value of home contents, Mr Skelton added: "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."