Excess and exclusions

Why this guide exists

9 out of 10 burglary victims in the UK have home insurance. One in three discovers, after the incident, that the compensation received is 30% to 70% lower than the actual loss. This is almost never a “scam” by the insurer: it is the result of rushing through the terms and conditions when signing up. Here are the classic traps, and how to avoid them.

1. The “theft” excess is not the general excess

Many policies proudly advertise a general excess of £250. But when reading the “theft” cover specifically, you discover a separate excess of £500 or even £750, sometimes more. On a loss of £2,000, you would therefore receive £1,250 instead of the expected £1,750.

What you should do: ask the insurer for the specific theft excess in writing. And negotiate. On recent policies, many insurers agree to lower this excess in exchange for a slight increase in premium (usually £1-£3 per month to go from a £500 to a £250 excess). Over 5 years, it pays for itself from the very first claim.

2. The limit for jewellery and valuables

This is the #1 trap for burglaries in the UK. Most home insurance policies limit the compensation for jewellery, watches, art, and collectibles to a global cap by default, usually £5,000 or £10,000. Beyond that, you are not covered even if the actual value is higher.

Worse: this limit is often per claim, not per item. An engagement ring worth £6,000, two watches worth £3,500, and £4,000 of hi-fi equipment = £13,500 in value, with a maximum compensation of £5,000.

What you should do: create an inventory with photos and receipts for your valuables, and declare them individually to your insurer. Most offer a “specified items” extension that covers your objects for their exact value, for an additional monthly premium of £2-£5.

3. Security requirements — the clause that excludes everything

Almost all policies require a minimum level of security. The most common clauses include:

• 5-lever mortice deadlock on the front door (often required for standard home insurance).
• Windows and doors locked when the property is left unattended.
• Active alarm system (often required for premium policies or to receive a premium discount).
• Anchored safe for jewellery exceeding a certain limit (often £5,000).

Failure to comply with even one of these clauses, as proven by the insurance loss adjuster, can lead to a total refusal of compensation or a proportional reduction (often -50%).

What to do: print out the list of requirements from your policy, check your home against this list, and rectify any shortcomings (changing locks, securing safes, etc.) before a claim occurs. The investment (£200-£500) is negligible compared to the risk.

4. “Proven” forced entry

The theft cover almost always only applies to thefts with proven forced entry: broken doors, smashed windows, or visible signs of climbing. Generally excluded are:

• Theft by deception (fake delivery drivers, fake gas technicians, fake police officers).
• Theft using a lost key, unless you had the lock replaced and reported the loss within 48 hours.
• Theft by a legitimate occupant (tenant, Airbnb guest, cleaner).
• Theft after a door was left unlocked (yes, even for 5 minutes while popping out to the shops).

What to do: some premium policies include “theft by deception” or “theft without forced entry” cover for an additional premium of £3-£8. If you have young children or elderly people at home, this is highly recommended: they are the primary targets for scammers.

5. Depreciation: the major legal trap

Unless you have a specific “new for old” replacement option, compensation is based on current market value: your TV bought for £1,200 four years ago will be reimbursed at £350. Your laptop bought for £1,800 two years ago: £900. The calculation method varies by insurer, but a depreciation of 10-20% per year is standard for electronics.

What to do: take out the “new for old” option for electronics and household appliances (usually £4-£7/month). For furniture and clothing, depreciation is very limited, and the option does not provide much benefit.

6. The waiting period and reporting deadlines

Two deadlines that are often confused:

• Waiting period (insurer side). Theft cover is sometimes only activated 30 days after taking out the policy. This is critical if you are moving in: ensure your theft cover is active from day one (most insurers will agree to this for a small additional cost).
• Reporting deadline (policyholder side). You generally have 24 to 72 hours to report the incident to your insurer, or risk your claim being rejected. You must also report the crime to the police (a crime reference number is mandatory for your home insurance claim).

7. Evidence to keep starting today

On the day of the incident, the loss adjuster will ask you for proof of ownership and value. Without these, the insurer will apply their own estimate, which is generally low. Create a file today including:

• Photos room by room (from every angle), saved in the cloud.
• Original receipts for items worth > £500 (TVs, computers, appliances, e-bikes).
• Professional valuations for jewellery and works of art worth > £2,000.
• Certificates of authenticity (watches, luxury bags).

This file takes 2 hours to put together. In the event of a burglary, it can make the difference between £4,000 and £11,000 in compensation.