Mugged - then comes the pain

Thousands of people may be taking a fresh look at their insurance cover after Home Office figures revealed that street crime and muggings have rocketed in recent months.

Figures released for December showed a 50% rise in muggings in some parts of the country. Around 36% of all street robberies in London involved mobile phones, according to to the police, with similar patterns in other major metropolitan centres.

Paying an additional premium on home contents in surance to cover against theft, loss or damage of valuables outside the home is a common way of getting some protection but, say insurers, be aware that you must ask specifically for the cover as it is unlikely to be offered as standard. And some postcodes could prove significantly more costly than others.

People in the UK spent more than £4bn on home contents insurance in 2000. Some 46% of policies were arranged when taking out a mortgage, and many policyholders will be unsure if they are covered for property stolen outside the home.

"We have a standard policy which covers contents within the home," says a spokeswoman for Direct Line. "Cover outside the home is offered as an option with an additional premium.

"Not everyone wants this cover so it's not included as standard and people can choose what they want when they need it."

The number of thefts involving mobile phones in particular has put the spotlight on insurance for single items of value.

For people wanting to insure only their phone, the choice is between extending home contents cover, or taking out a separate policy just for the phone.

Carphone Warehouse, for example, offers a standard policy that includes theft and loss, water damage as well as unauthorised calls, which is not generally a feature of home contents policies. It costs £89 a year and customers are tied in for 12 months. Pay a further £18 and you can opt out at any time.

Whether this is value for money will depend on the cost you are quoted for extending home contents cover.

The cost of home contents cover can vary greatly. Direct Line's cover for property outside the home is set at a minimum of £2,500, averaging out at around £45 more over a year on top of the standard policy premium.

Norwich Union advises policyholders to check exclusion clauses carefully and says that as long as the claimant has taken "reasonable care" with their property, they should be covered.

Both say mobile phones are treated in the same way as any other valuable.