Tailored solutions for insuring pricey goods

Standard policies may not cover your requirements

IF YOUR home contains valuable art, antiques, or you have a penchant for adventurous holidays, you are likely to find that standard insurance policies – the kind offered to you by meerkats and opera singers – won’t provide adequate cover if something goes wrong. But there are products and bespoke policies that may provide the solutions you need. We look at some of the areas where a more innovative approach may be necessary.

Choosing private education is a crucial investment decision, and like a house, should not be taken without the necessary precautions. The average UK school fee per term for a day school is about £3,400. And boarding school fees cost on average £7,800 per term. Over recent years, UK school fees have been increasing at around 6 per cent per year, according to the Independent School Fees Advice. Nonetheless, many parents overlook the possibility of insuring school fees to guarantee their child’s education continues uninterrupted in the event of death or loss of earnings. The School Fees Trust Scheme – a group life insurance scheme that enables parents to insure fees against death or serious illness – offers a policy that will pay the amount of school fees you have chosen to insure direct to your child’s school until they leave at 18. Its premiums start at £12.50 a month – very little when you consider the possible disruption of forcing your child to change school in the event something goes wrong. And there are alternatives that offer more flexibility – for example, leaving a lump sum to a spouse, giving them more freedom with the money after your death.

Private healthcare can offer increased choice, shorter waiting lists, greater privacy, and more frequent medical checks, but it is growing increasingly expensive – especially for those seeking cover in old age. A hip replacement in a private hospital, for example, can cost up to £14,000. Private medical insurance policies are complicated, so it may be worth seeking the advice of an independent financial adviser to choose one that suits your needs. Alternatively, the Association of Medical Insurance Intermediaries and the British Insurance Brokers Association will help you find a suitable broker.

Which? recently compared policies for individuals aged 35 and 70. Some of the best include the Axa PPP private health plan, which has an annual cost of £765 at 35, and £2,383 at 70. Aviva’s Healthier Solutions costs £564 and £1,738 respectively. Bupa’s Bupa By You’s comprehensive policy costs £960 and £2,640 respectively. They’re not cheap, so it is worth finding out whether your employer has access to discounts that could make the sum more affordable.

High-net worth insurance companies offer individuals with expensive homes and interiors a range of cover far greater than a standard home insurance policy. A tailored service will be more expensive, but it will ensure your home and possessions are properly protected. The terms and fees will vary from one policy to another, so it is important to compare them carefully.

If you have pricey assets, Aviva’s Distinct range offers high-net worth policies, with a single limit of £15,000 for jewellery, watches and guns, and up to £25,000 for art and antiques with a standard £250 excess. It is, however, only available through insurance brokers. Hiscox has a single article limit of £25,000 for fine art, and Zurich’s buildings insurance gives comprehensive cover that includes gardens and landscaping – including up to £2,500 for any one tree, shrub or plant.

Standard travel insurance policies will likely cover cancellation and curtailment (often up to £3,000), compensation if your flight is delayed over 12 hours, up to £1m personal liability, and pay out (usually up to £1,500) if your personal possessions are lost. Medical cover is typically up to £2m.

Premium policies, however, have much higher limits than their standard counterparts, making them better suited for those with more pricey or adventurous tastes – usually up to £10m in emergency medical expenses and £2m personal liability cover, as well as cancellation and curtailment cover. Hiscox Annual Travel Insurance will pay out up to £3,000 for lost baggage, and up to £1,500 for a missed departure. For a family of four, it costs £242 per year. A similar policy from John Lewis Premier Travel Insurance will cost around £240. Barclays Annual Multi-Trip charges less, at £163 for a similar policy, but the cancellation limit is lower at £5,000. Be aware that most family policies will cover children up to 23, and you may pay a premium for dependants above that age.

If you are among the 2.3m people in England and Wales with a second home, you will no doubt want to protect your property in the event something goes wrong. A holiday home is of course vulnerable to the same risks as a main home – burst pipes, flooding, theft – so you will need both buildings and contents insurance. But, warns MoneySupermarket, “standard house insurance cover is not enough for second homes because it does not normally pay out if you leave the property empty for more than 30 days a year”. Comparison websites will do a lot of the work for you, so do your research and bear in mind that buying buildings and contents cover from the same insurer may be cheaper than separate policies from different firms. And be aware that some policies won’t include certain countries, and most won’t cover accidental damage, alternative accommodation or personal possessions cover.

If there’s a yacht parked outside your holiday home, JLT Personal Insurance Providers, for example, will insure marine craft for tenders up to 16 feet in length, outboard motors up to 10 horse-power, with the cover including medical expenses, legal liabilities to third parties, and loss of personal effects.

Insurance policies vary greatly from one to the next and, whereas standard policies will often offer lower premiums by including restrictive conditions and limits, this won’t help those with higher value cars, jewellery, or arts and antiques. The Hiscox Fine Art policy offers cover for physical loss or damage worldwide, including transit risks and new acquisitions (any items you acquire during the period of insurance) cover of up to 25 per cent of the total amount insured.

The insurance policy on a classic car will often be cheaper than for a modern vehicle. But remember that, following the 2011 continuous insurance enforcement rule, if your car is taxed, it must also be insured – regardless of how many months of the year you drive it. And MoneySupermarket warns that the valuation of a car can pose some problems, and in the event of a write-off, the payout may not reflect the true value of the vehicle. So it is crucial to agree a value before signing an insurance policy.

More than 2m pet owners buy cover each year. If you think your dog is worth it – and don’t want to see Rover taken to an animal charity in the event that you can’t pay your bills – Petplan offers an Ultimate insurance plan that covers up to £14,000 a year of treatment costs. For a five-year old labrador, this will cost £55 per month – including a 10 per cent online discount.

A standard horse policy, meanwhile, will usually include cover in case of death, theft or straying. Many owners will opt to add cover for vet bills, as they can prove costly. And Horse and Hound warns that, under the 1971 Animals Act, you are liable if your horse should injure someone or damage their property – regardless of whether you are negligent. You can usually choose an appropriate limit, but MoneySupermarket recommends a minimum of £1m.

Horse-insurance.co.uk offers cover for vet fees of up to £4,000 per incident and public liability cover of up to £1.25m. E&L will cover vet fees up to £5,750 per incident and an extra 5 per cent discount when insuring more than one horse.