Insurance specialists Simon Aitken and Alice Bartley of Lycetts Insurance Brokers answer the essential questions every homeowner should ask when protecting their property, lifestyle and valuable possessions.
Q. Why do so many high‑value homes end up underinsured?
Simon: Underinsurance is remarkably common, even among owners of luxury homes. This usually stems from insuring a property based on its market value, rather than the true cost of rebuilding it from the ground up. For high‑value residences – where craftsmanship, specialist materials and architectural detail often define the character of the home – the rebuild cost can be significantly higher than expected.
Construction costs have risen sharply in recent years, and reinstating bespoke features or specialist finishes requires time, skill and often rare materials. If the rebuild figure is underestimated, insurers may only pay a proportion of any claim. For homes with unique characteristics or heritage features, ensuring a precise valuation is not simply a procedural task; it is an essential facet of wealth protection.
Q. What should homeowners consider before beginning renovations?
Alice: Renovations, particularly at the top end of the market, can transform a property’s complexity – and its insurance requirements. Whether undertaking structural alterations, excavating basements, redesigning interiors or installing advanced technology, each stage introduces risks that standard policies rarely anticipate.
Before work begins, it is crucial to ensure the policy remains valid throughout construction and that any contractors’ activities are appropriately covered. Renovations often increase the rebuild cost, so the insurance must evolve alongside the project, not trail behind it. Homeowners should also consider the potential impact of a major loss mid‑project. For families accustomed to a particular standard of living, alternative accommodation must be adequate in both quality and location, ensuring minimal disruption to schooling, travel or social commitments.
Q. Which features tend to make rebuild costs higher than expected?
Simon: High‑value homes frequently incorporate elements that far exceed standard construction assumptions. Bespoke kitchens, hand‑crafted joinery, imported stone, specialist timber, intricate glazing, tailored lighting, audio‑visual installations, intelligent home systems, wine rooms, wellness spaces and landscaped grounds all elevate both the living experience and the cost of reinstatement.
These features are often integral to the property’s identity. Replacing them requires artisans, specialist suppliers and extended timelines. A rebuild assessment must account for the home’s full specification- its texture, materials, provenance and individuality. Only then can a policy genuinely reflect the reality of reinstating a one‑of‑a‑kind residence.
Q. How should homeowners approach insurance for valuable possessions?
Alice: For many high‑net‑worth families, valuable possessions – from jewellery and watches to fine art, sculptures, antiques and luxury accessories – represent a significant accumulation of personal capital. These items do not hold steady in value; they appreciate and shift in response to global markets, scarcity and cultural trends. Yet homeowners often rely on valuations that are years out of date.
A diamond ring bought twenty years ago may now be worth several times its original price due to fluctuations in commodity values. Similarly, a painting can increase significantly in value as an artist’s reputation grows. Inherited items, in particular, may never have been professionally valued. Portable items, such as watches or jewellery, are especially at risk if they are not properly itemised.
High‑value insurance providers often offer agreed‑value protection, which provides clarity in the event of a loss. Regular valuations and appropriate storage, particularly the use of well‑graded safes, help ensure that cherished pieces are both adequately insured and suitably cared for.
Q. Do gaps in cover sometimes only come to light after a claim?
Simon: Unfortunately, yes – and when they do, it can be both surprising and unsettling. Gaps in cover often only come to light when a claim is made, particularly where policies have been arranged on standard assumptions rather than reflecting the true nature of the risk.
One homeowner experienced this after a valuable painting was accidentally knocked from a staircase wall resulting in an unintended head-through-canvas moment. While the incident became an amusing anecdote, it also highlighted the importance of understanding how unique items are treated under a policy and the specialist restoration involved. Reassuringly, the painting was covered.
In another instance, a property finished with specialist materials had been insured on the basis of standard specifications. When a significant claim arose, the cost of reinstating those bespoke features far exceeded the sum insured, leaving the owners with an unexpected and avoidable shortfall.
These scenarios highlight an important truth: insurance must reflect the actual characteristics and value of the home and its contents. Generic assumptions simply don’t stand up when a claim involves artisan craftsmanship, rare materials or high-value items.
Q. What other considerations should homeowners keep in mind?
Alice: High‑value lifestyles naturally involve complexities that standard insurance policies may not accommodate. Factors such as extended travel, the presence of household staff, children living away at boarding school or university, or regular use of the property by guests all require clear disclosure and tailored protection. Each scenario has implications for liability, security and the continuity of cover.
Q. What is the single most important step homeowners can take?
Simon: Your home is bespoke. Your insurance protection should be no different.
Regular reviews are essential. These discussions allow homeowners to update rebuild valuations, revisit the worth of jewellery and art, consider lifestyle changes, account for recent renovations, and reassess how the home is used. At Lycetts, clients are encouraged to meet the team at Bank House in central Newcastle, where advisers can explore these details discreetly and in depth. The firm works closely with leading high‑net‑worth insurers, including Hiscox, Chubb, Zurich and Aviva, to provide cover that reflects the true individuality of each home.
Trusted advice for homes and valuables
Lycetts works with private clients, property owners and businesses, providing specialist advice on protecting homes, valuable possessions and complex lifestyles. From high-value properties and renovation projects to jewellery, art and multiple residences, its advisers take a tailored approach to ensure insurance keeps pace with clients’ changing needs
The company is part of the Benefact Group, an international family of financial services businesses whose ultimate owner, the Benefact Trust, donates all available profits to charity. This commitment has had a meaningful impact across the region, with recent beneficiaries including NE Youth, St Oswald’s Hospice, Children’s Cancer North, Tyne Amateur Rowing Club and The Lighthouse Project.
