The contents sum insured should reflect the amount required to replace the insured office property following a major loss.

It should not simply be based on the depreciated value recorded in the business accounts.

What should be included? #

Depending on the business, office contents can include:

• Desks and chairs.
• Computers.
• Monitors.
• Printers.
• Servers.
• Networking equipment.
• Telephones.
• Meeting room equipment.
• Storage furniture.
• Other office equipment.

The policy definition of contents should be checked.

Should I use accounting values? #

Not necessarily.

Accounting values can be reduced through depreciation and may be substantially lower than the cost of buying replacement equipment.

Insurance values should generally reflect the basis of settlement required by the policy.

What about tenant improvements? #

Fit-out and tenant improvements can sometimes require separate consideration.

Examples include:

• Built-in cabinetry.
• Internal partitions.
• Flooring.
• Lighting.
• Electrical work.
• Other improvements paid for by the tenant.

Whether these are treated as contents, tenant improvements or part of the building depends on the policy and lease arrangements.

How often should the value be reviewed? #

Review the sum insured when:

• The office expands.
• New equipment is purchased.
• The business relocates.
• A significant fit-out is completed.
• Replacement costs increase.

A major office relocation is a good opportunity to complete a full contents review.