Home contents insurance protects your personal belongings against various types of damage. However, choosing the right sum insured is essential to ensure that your belongings are adequately covered.
If the sum insured is too low, you may face underinsurance. If it is significantly too high, you may pay unnecessarily high premiums.
This guide explains what you should consider when determining the right sum insured.
What Is the Sum Insured?
The sum insured represents the value of your insured household contents. This can include furniture, clothing, electronic devices, household items and personal belongings.
The amount should generally reflect what it would cost to replace your household contents after a major loss.
Why Is the Right Sum Insured Important?
If the sum insured is too low, your household may be underinsured.
This means that the actual value of your belongings is higher than the amount covered by your policy.
In the event of a claim, compensation may therefore be reduced depending on the extent of the underinsurance and the terms of the policy.
How Can You Calculate the Value of Your Contents?
One practical approach is to go through your home room by room.
Consider items such as:
- Furniture
- TVs and computers
- Smartphones and electronics
- Clothing and shoes
- Household appliances
- Sports equipment
- Jewellery and valuables
- Personal belongings
Do not focus only on expensive items. Many smaller purchases can add up to a significant amount.
What Happens If You Are Underinsured?
Underinsurance occurs when the actual value of your household contents exceeds the sum insured.
For example, your contents may be worth CHF 100,000 while your policy only covers CHF 70,000.
In the event of a claim, compensation may be reduced according to the level of underinsurance. The exact calculation depends on your policy and its conditions.
Should You Review the Sum Insured Regularly?
Yes. The value of your household contents can change over time.
A review is particularly useful after:
- Moving home
- Renovating
- Making major purchases
- Getting married or starting a family
- A significant change in your standard of living
This can help ensure that your coverage remains appropriate.
What About Valuable Items?
Particularly valuable items such as jewellery, artwork or collections may be subject to specific limits or conditions.
It is therefore important to check your policy and determine whether additional coverage is necessary.
What Should You Compare?
In addition to the sum insured, consider:
- Which risks are covered?
- What deductibles apply?
- Are there compensation limits?
- Which items are excluded?
- Are additional cover options available?
The premium should not be the only factor when comparing policies. The actual scope of coverage is equally important.
Important to Know
- The sum insured should reflect the actual value of your household contents.
- A sum that is too low can result in underinsurance.
- Smaller belongings should also be included in your calculation.
- Your sum insured should be reviewed when your circumstances change.
- Valuable items may be subject to special limits.
Summary
Choosing the right sum insured is an important part of home contents insurance. Estimating the value of your belongings realistically and reviewing the coverage regularly can help reduce the risk of underinsurance.
Comparing the coverage and policy conditions can also help you find protection that suits your personal circumstances.
FAQs
Generally, the total value of your insured household contents.
Compensation may be reduced in the event of a claim.
Not necessarily, but regular reviews are advisable.
Not always. Special limits may apply depending on the policy.
Check whether the value of your belongings and your sum insured are still appropriate.
