If I have a claim, do i have to accept a replacement item or can I ask for a cash settlement?

The insurer will be happy to pay your claim rather than provide a replacement item. In many cases where it is impossible to replace an item on a like for like basis, then a cash settlement is the only solution - for example, where an antique is claimed for.

Where the insurance company can replace an item, for example a carpet, then the insurer will usually get a discount from the supplier. Therefore, a carpet with a claim value of say £1,000 may actually cost the insurer £750 to replace. In these sorts of situation, if you specifically ask for cash, the insurer may insist on paying you what it would have paid out to replace the item - in this example £750 instead of the £1,000 claimed.

Broker Boy