Insurance warning over gold values

07/09/11

Richard Cranidge

The increasing value of gold and silver is leaving millions of people with under-insured jewellery, experts have warned.

Many people have not had items revalued in recent years, despite the price of gold repeatedly hitting all-time highs. Figures show it has risen by 50 per cent in the past 12 months, while silver costs nine times as much as it did a decade ago.

As many as six million householders have out-of-date home contents insurance, and claims are increasing because more burglars and thieves are targeting jewellery due to the record prices. But many people are missing out on an appropriate payout due to out-of-date values.

Philip Diaper, who manages London's Suttons & Robertsons pawnbroker, said the price of gold has soared. "A common garden gate bracelet 10 years ago would have melted for £65. Today it is worth £350," he said.

The head of underwriting at Churchill Home Insurance has warned that about 40 per cent of people claiming for lost jewellery and gold do not have enough cover. Ian Davies added that about a third of theft claims to the insurer now relate to jewellery.

He warned the amount people are under-insured "can be up to three or four times the value that the claimant originally thought the item was worth".