Following a recent break-in, I've had a nasty shock concerning the insuring of household items, tooling and equipment.
The reason is 'discounting'. The worst offender appears to be Norwich Union Direct but it's not solely restricted to them by any means. They apparently started it with other insurance companies trying to follow.
It works like this - The insurer agrees a cosy deal with a number of suppliers for discount products. When you make a claim you get an inoffensive letter telling you 'your claim will be handled by x (the supplier)'
When the amount is agreed, instead of a cheque you get a voucher that is only redeemable with that supplier. If you protest and ask for an open cheque you are offered a cheque for about 2/3rds of the sum.
Putting this in context, you may get your workshop stolen, but receive a voucher that's only usable in Clarke's Tools - a long standing supplier but not one that stocks Myford, etc..
In our case a claim for jewellery was restricted to Goldsmiths, but with a caveat that it could not be used on certain brands of jewellery in their stores irrespective of the original claim items.
It's certainly worth checking with your insurer!