New for old is not what it seems!

Our policy is due to renewal and as the caravan is under 5 years old, we opt for the New for Old cover.

We have always assumed that having the new for old cover, contents under Section 2 are also covered on a new for old basis.

On querying this with the CC, in an email sent to me they stated the following;

Section 2 'Contents', is your basic household items.  So this would be things like a small T.V, clothing, bedding, pots & pans, cutlery etc.  The contents is insured on a market value basis, i.e. it's second hand value.  So you would need to work out how much you think all this would come to.

I am gobsmacked as I was under the impression that if you had a New for Old policy, everything was covered on that basis.  I think this is a serious misrepresentation unless I have somehow misunderstood the policy and wonder how many others don't realise that their contents are only covered up to second hand value determined by the insurerer. 

Every policy we have, cover is for the current market value and not the second hand value! 

Please tell me I have misunderstood the cover.