Does your home insurance policy cover digital downloads?

man with ipad

Here’s a question. When was the last time you bought a CD? What’s that, you can’t remember? Can you recall when you last purchased a DVD? No? A book, then? Surely a magazine??

OK. While it was probably too long ago now for you to call to mind when you exchanged cold, hard cash for any of these, the odds are you CAN recount the last time you downloaded your favourite music artist’s latest album AND that movie you missed at the cinema but finally watched the other week. To the very day, probably.

While vinyl records might be experiencing something of a retro renaissance in the last couple of years (as some of us crave actually getting our hands on something), the same can’t be said about  CDs or DVDs; as society as a whole turns increasingly towards digital downloads to be entertained.

Although some of us may be old enough to look back fondly to those bygone days of radio cassettes and Betamax videos, millions more have consigned these to home entertainment history along with those holiday slide projectors, ghetto blasters and ZX Spectrum home computers.

Instead – and although we still don’t receive our kicks for free – the money we physically pay for music, film and gaming seems to be in exchange for nothing.

Nothing immediately tangible anyway, as digital downloads are king. Be it for streaming music, film, television series, novels by our favourite authors and/or games, the use of PCs, laptops, tablets, smart phones and portable music devices (no, NOT Walkmans!) is commonplace; and as easy as ABC.

The thing is you don’t actually end up owning something you can hold in your hands and think of as a possession. And that’s where the subject of protecting these unseen personal belongings and assets is a very contemporary question raised by the insurance industry.

home insurance


If you can’t see your latest music album, Hollywood blockbuster or weighty tome by E. L. James, then what chance has your insurance provider got of safeguarding it?

The unswerving fact of the matter is digital downloads ARE your property and as such require insuring against the feasible possibility of damage or loss. While the devices you store all these downloads on are fully insured – typically as part of a contents insurance policy and including computers, laptops, mobile phones, e-readers, etc – the data captured on these devices isn’t. And this should remain a cause for concern.

So the question remains, does your home contents insurance policy cover them?

Alarming statistics from leading insurance price comparison website, GoCompare, gathered in 2014 reveal that some 41% of a selection of 313 home insurance policies viewed failed to offer any semblance of insurance cover for lost digital downloads.

What’s more, of those insurers which did provide cover there was found to be a huge variation in the level of protection available, with anywhere between £150 up to £10,000 quoted.

AXA Insurance only covers digital content up to the value of £500, while LV and Direct Line ramp up their policies to the tune of £1,000, yet Hiscox covers up to £2,500 per incident.

On average an amount between £500 and £1,000 seemed to be the ball-park figure according to the insurance product comparison site’s research. With this in mind, we’d urge home contents policyholders to revisit their existing policy agreements to ascertain what – if any - digital download materials and quotas/volume are covered.

It really is staggering to think just how much information any one of us have stored on our mostly portable, download-savvy devices at any one time. Research conducted by insurance price comparison giant, a couple of years back learned that on average our hard drives accommodate nigh on £1,200 worth of digitally downloaded music, movies, TV series and/or software.

A 64GB smartphone for instance can hold around 14,000 songs – as can the equivalently powered mp3-player – while a Kindle e-reader can store well over 3,000 book titles. Yet what happens if all this material is destroyed courtesy of hacks or viruses as well as the more conventional losing or damaging of the hardware supporting this vast quantity of infotainment.

Although some people (possibly the more geeky individuals) might have been wise enough to have backed-up all this data to our hard drives (or transferred them to the Cloud), there will still be millions of us who haven’t.

And with iTunes tracks costing nearly £1 a pop and the likes of Spotify charging customers more than a pretty penny, a fully-loaded digital download-friendly device has the potential to be worth in the region of tens of thousands of pounds in downloads alone.

Despite an increasing number of insurers offering dedicated ‘gadget insurance’ these days, the actual policy will essentially only safeguard the handset/device itself, as opposed to the content real estate which you’ve downloaded onto it.

Meanwhile many of those insurers who do make a point of insuring your digital download content also make distinctions between the streamed data you direct to your smartphone and that which you channel to your computer or alternative entertainment platforms and portals.

So basically it’s crucial that you go over the wording of your recognized download policy within your home contents package with a fine toothed comb to ensure that all bases are appropriately covered.

Returning briefly to the subject of external hard drives as a form of back-up, and memory is becoming more affordable year on year and today you can bag an external hard drive which brandishes some 1 Terabyte of storage (which in old or new money equates to 10,000GB) for under £70.

Having said that you’d still have the unenviable task of perpetually backing-up accumulating data, and there’s still always the chance that the hard drive itself could suffer damage or end up lost/stolen. So arranging a suitable digital download insurance within the constructs of your existing – or new – home contents insurance policy is the best bet to ring fence your uber modern entertainment back catalogue in our opinion.