Insurers use vouchers rather than cash payoutsVouchers make like-for-like replacements harder

25 May 2011


Home insurers are offering vouchers rather than cash pay-outs

Home insurers are paying off claims with retailer vouchers rather than stumping up cash, as policyholders would expect.

Which? has discovered that some home insurers are settling claims with vouchers from retailers, such as Comet and Argos, rather than paying out in cash. In many instances, this has made it impossible for policyholders to get like-for-like replacements, yet not even mentioned the voucher payment options in policy terms and conditions. 

Lost wedding ring for vouchers

One Which? reader, Tony Strevens from Aylesbury, lodged a home insurance claim for his wife's lost wedding ring through HSBC. Although the ring was valued at £660 by the retailer, he was offered £430 of vouchers for an online store. The couple did not like the selection on offer and requested a cash payout instead. They were given just £196. 

Another reader was given Argos vouchers to replace a laptop computer. The model was available via the Argos website, but the voucher was only redeemable in-store and the local branches did not have the model in stock. 

Home insurance should be fair for all

Which? insurance expert Dan Moore said: 'We were surprised that vouchers were so readily dished out, especially because in most cases we looked at made no reference to this in T&Cs. I doubt insurers would take premium payments in the form of luncheon vouchers, so why should they issue vouchers over cash?'

For more information on this, see the Which? Home insurance guide

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