The release of Sex & the City 2 earlier this year once again highlighted the attraction of designer clothes and accessories to South Africa’s women. However, with the majority of these women vastly underestimating how much their wardrobes are actually worth, it is vital that our female clients understand the pitfalls of not insuring their wardrobes for the true cost of replacement.

 

The regular assessments we make at MUA of our client’s possessions have shown that about 90% of women – particularly in the high end market – significantly underestimate the cost of their wardrobes, estimating them to be just half of their actual value.

 

Underinsurance is not just a local trend. There seems to be a global tendency towards underinsurance in women’s wardrobes with a recent study in the UK by British insurer Liverpool Victoria revealing that the average woman in the UK only values the contents of their wardrobes at about £1,840 (R22,000). The true cost is actually around four times higher at £7,000 (R84,000).

 

The main cause of this stems from the fact that insurance values are calculated on the replacement cost of items, so a designer suit that would have cost your client R2 000 a few years ago, will probably now cost in the region of R10 000 to replace. This issue of replacement cost is something that the public often don’t take into consideration, and in our experience is an issue that clients need to have explained to them.

 

Of course, while it is quite rare that an entire wardrobe would need to be replaced, should a client suffer a break in or fire, it is vital for them to have apportioned the correct replacement value to their wardrobe to ensure everything can be replaced if necessary.

 

There are various tips you can employ to help clients work out the true cost of their wardrobe. One of these is to divide the clothes into sections such as business, casual, evening and sports. This should help the client to have a better idea of what clothes they actually have so that they can make a more accurate valuation. This also helps to highlight those items that one forgets about but refuses to throw away.

 

If your client also has a large number of expensive or designer outfits, it can be a good idea to suggest a professional valuer to assist them in the process. At MUA we provide a professional valuation service to all of our clients, so that they know exactly how much their wardrobes are worth.

 

It is easy to underestimate the value of a woman’s wardrobe, especially if the clothes were bought many years ago. However, by being proactive your client will end up saving thousands in the long run and will truly see the value of their broker.

 

Another addition to insurance is cover for their handbag and its contents. It has become quite acceptable for women to spend large amounts on expensive designer branded handbags, in line with what was spent on jewellery pieces in the past.  A designer handbag can cost thousands itself, before one even assesses the value of its contents such as keys, make-up, MP3 player, cell phone and wallet.

 

Insuring a handbag is a relatively cheap addition to any policy but it is crucial for all women and it is a suggestion that your female clients will be hugely appreciative of should they ever have the need to make a claim.

 

A broker that takes the time to explain these issues and obtain a proper valuation for their client’s personal items is not only able to highlight their own worth to their client, but they also keep their customer book bulging as much as their client’s wardrobes.