New for old is a way of settling insurance claims in which a lost or damaged item is valued at the cost of buying an equivalent new one, rather than at its second-hand value. Without it, a policy pays only what the item was worth just before the loss, after allowing for age and wear.
At Wigwam
Our contents protection settles claims new for old. So for most things, if a ten-year-old sofa were damaged by a burst pipe, its value would be the price of a similar sofa bought new today, not what a ten-year-old sofa would fetch. The excess is £50.
A few things are valued differently, because “new” doesn’t fit them:
- clothing and household linen, and any motorbike or other motorised vehicle, allow for age, quality, use and any existing damage;
- things you can’t buy new, such as antiques or works of art, are valued at their current market value;
- documents are valued at the cost of replacing or reprinting the paper, not the value of the information in them.
Why it matters for your declared value
New for old only works in your favour if your declared value is set on the same basis: what it would cost to replace everything as new today. If the figure is lower than that, a claim is settled in proportion, so declaring half of what your things are worth would get back half of the loss. Our guide to calculating a full replacement value walks you through it room by room.
If you use your own insurance instead, check whether it settles new for old, as policies differ. Questions? Call us on 0800 2545585.
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