EQC and depreciation on contents claims

The following experience is from yesterday's Avonside Community Group newsletter.

I live in Retreat Road and wanted to share my experience with EQC today over our February contents claim as a warning for others.

We were sent the contents settlement detail with a value for each of the items and a total claim value (less than $20,000), however a depreciation value had been taken off all of the items one year old or greater; including our TV, stereo, chainsaw, plates, glasses etc. The reason give for this was that our contents insurance policy was market value only and therefore there was a depreciation factor that applied. For example, a mantlepiece clock that we had valued at $100 and 10 years old was depreciated by $50 leaving a payout value of $50, and our stereo which we'd valued at $300 and aged at 10 years was depreciated down to a payout value of $0.

I thought that this depreciation thing was strange as it hadn't been taken off when our contents claim from September was settled so I called the EQC to ask about it. They explained that they had taken the depreciation off in line with what our insurance policy was and therefore what our insurance company would do. I quickly checked our contents insurance policy and it clearly said that we had replacement insurance and I explained this to EQC. However, they said although we had replacement insurance the value of our contents would still be depreciated to market value. They were adamant about this and wouldn't budge even when I read the policy details out to them over the phone and said that we hadn't had depreciation taken off the September claim. I got off the phone pretty disillusioned having had about 60% wiped off the value of our claim and wondering why we had insurance in the first place.

I thought about it for a bit and called State insurance to check with them about the interpretation of our policy and explain what had happened with EQC. They were great. They got straight onto it and called EQC with me on the other line at the same time, making it very clear to EQC that no State wouldn't take depreciation off contents with a replacement policy (except for things like clothes that wear and also computers). EQC subsequently said they will correct their error.

So a long story but I just wanted to share it so you can let others know. I don't want anyone else to get caught out in the same way by EQC.

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