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What is new for old insurance?

In insurance terms, ‘new for old’ means that, should you need to make a claim, you’ll be given the equivalent value of the item that has been lost, damaged or stolen. This means that wear and tear will not be taken into account when assessing the value of your belongings.

This is a particularly useful cover, as it means even if your items have depreciated in value, you won’t be left out of pocket should you need to make a claim.

How does new for old cover work?

When taking out your possessions or gadget insurance policy, you’ll need to provide a ‘sum insured.’ When calculating the value of your belongings, you should take into consideration the replacement value of the item (rather than the depreciated value of an item), as this is the amount that you will be able to claim for.

As an example, imagine if you were to lose or damage your 2 year-old iPhone. With new for old cover, your insurance policy will pay out for a new one of equivalent value to the original, regardless of age. If your model is no longer available from Apple, your iPhone would be replaced with the closest available model.