Your Money: Bleak house: cover that springs a leak

A significant proportion of people who claim on house insurance policies are being paid less than they claim for, and some may be being unfairly short-changed. One in seven people surveyed by the Consumers' Association (CA) who have had a claim paid recently report that it was not paid in full.

This can translate into a shortfall of hundreds or even thousands of pounds for policyholders. According to NatWest, itself a large insurer, individual theft claims average pounds 1,800 in London, and in excess of pounds 1,000 elsewhere, while claims for flooding can run into many thousands of pounds.

The CA survey results are detailed in this month's issue of Which? magazine. It lists ways in which insurers avoid paying the full value of your losses.

Often there will be deductions for wear and tear. Most home contents policies give new-for-old cover most of the time, with notable exceptions such as for bed linen. But watch out too for policies that make a deduction for wear and tear for everything.

In addition, insurers often claim estimates for repairs are too high. Policyholders should fight their corner by getting additional estimates, says Which?

Not all policies will cover you for accidental damage and insurers may also insist on specific conditions for certain items. For example, bicycles may not be covered unless locked up. Which? also warns of the dangers of under-insurance. If, for example, you insure your home for 75 per cent of the cost of rebuilding it, the insurer may only pay 75 per cent of any claim.

The magazine notes that some insurers replace items from their own suppliers, rather than giving you money to replace them yourself. They claim that such arrangements allow them to do replacements cheaply and pass on these savings to policyholders generally by keeping premiums down. If the insurer can't get the same model or, say with jewellery, you feel you are getting an inferior replacement, hold out for cash.

Which? offers a number of tips for reducing the hassle of making claims - and the risk of your claim not being paid in full. These include:

q For items whose value is difficult to prove - such as antiques and jewellery - it might be worth obtaining professional written valuations in advance.

q Keep a checklist of the make, model and serial num-bers of items such as hi-fi's, TVs and microwaves.

q If you don't have receipts to prove an item's value, offer your insurer the original packaging, a credit card statement for the purchase or even sworn statements from friends.

q Take photographs of damage before getting emergency repairs done, and get receipts for the work.

q Start compiling a list of missing or damaged items for your insurer as soon as possible, but include on the claim form the caveat, "everything that I am aware of at present".

q Don't throw anything away, such as ruined carpets, until your insurer has settled the claim.

q Many insurers employ loss adjusters to deal with large claims. Their job is to check a claim is genuine, that it's within the terms and conditions of your policy and that the amount of the claim is reasonable - and in theory they should treat you fairly. But one person in the Which? survey said their adjuster made them feel like a criminal.

The CA recommends complaining to your insurer if you find the adjuster's attitude offensive. If the adjuster rejects your estimates for repairs, ask for a written explanation. If you then agree to a lesser or cheaper repair, keep both the original estimates and the explanation. You can then use this to help make a further claim against your insurer if the repair turns out sub-standard.