Modern policies usually come with ‘new for old’ settlement as standard for contents and personal possessions, with no deduction for wear and tear and depreciation. The only exception being clothing and linen, which generally have a short life span. Great for the insuring public and beneficial for insurers, who don’t want to waste time and resources haggling over claim settlements.
To make the ‘new for old’ agreement between insurers and policyholders a fair one, the contents should be insured for the new replacement cost. Therefore when you are calculating a sum insured that is right for you, think of the new price for your contents. For guidance with your home contents sum insured try the home contents calculator