If someone makes off with your iMac, chances are you can claim the value of the device back from your insurance; but what about the music stored on it?

Insurance companies are finally realising that of more value to the consumers is their collection of digital media rather than the physical storage devices.

Nationwide is one of the first insurance companies to include music and other media downloads in its home contents cover. The company says that the digital files are part of the family valuables, just like hard copies of the files would be. Since they cover loss of CDs and DVDs, why not digital files as well?

The building society’s cover extends to any download, including ringtones and games, but the owner will have to prove that they purchased them in the first place. This isn’t that hard to do, especially if they were paid for by credit card, as there will be a record on the statements.

Nationwide is careful to point out that the cover does not extend to accidentally wiped hard drives.

This shift in policy by the insurers is part of a growing realisation that media downloads are here to stay, and set to grow exponentially in popularity in the next few years. The BPI says that legal downloads far exceed the sale of singles in the shops since December 2004, while analyst Screen Digest says that online music sales in Europe will reach £190 million by the end of this year, up from £82 million last year.

Amazingly, only 7% of Brits have a portable music player, but this has increased from 2% in 2004.

So are other insurers following Nationwide’s lead? Mike Holliday-Williams, of More Than, said to The Independent, “Electronic goods such as iPods, BlackBerries, mobile phones and laptop are expensive to replace – especially when you conside the value of downloaded material held on them".

“The way people are living their lives is changing and insurers need to respond.”


The Independent