Make sure your home is insured for the correct amount
Many homeowners may have houses that are under-insured in terms of total replacement value. This poses a serious financial risk should disaster strike, for example your home is destroyed by a fire or flood and you need to have it rebuilt.
It's important to review your house insurance policy regularly to make sure it is up to date, for example to cover any additions or renovations you might have made since taking out your policy. These could include new decks, fencing, garages, house extensions etc.
As your policy will be based on the construction, location, size and standards of your house, if these change over time then you may find you are not covered for full replacement costs should the unexpected happen.
Let your insurance broker know if the use of your house changes
If the use of your house changes and you tenant it out or start to run your business from home where clients visit on a regular basis, then you need to let your broker know. These are regarded as a ‘change in circumstances’ and they may affect the validity of your policy.
Rather than be caught short in the event you need to make a claim, you should keep your insurance broker up to date with any changes to your property both in what it is being used for and if you have made any alterations or additions since the policy start date.
The importance of having a comprehensive house insurance policy
Your home is likely to be your most expensive asset, which means it’s important to have a comprehensive insurance policy. This will help ensure that everything you need covered can be included. All dwellings on the property (house, sheds, garages etc.), and all fixtures that are permanently built-in or attached (appliances, exterior awnings, carpets, water tanks etc.) should be covered by your house insurance policy. Your broker is best to discuss your requirements with you.
Know what risks your house insurance will cover
In the event that you need to make a claim, your policy should provide protection against unintentional damage caused by fires or floods, damage to fixtures such as doors, windows and locks, or resultant damage from leaking hot water cylinders or internal water pipes. You should check with your broker around the finer details of the policy, for example in relation to gradual structural damage caused by unseen rot or mould, as some restrictions may likely apply.
Most comprehensive house insurance policies will include personal liability cover that protects you in the event you accidentally cause damage to someone else’s property or injury to another person, provided it’s connected to the ownership of your home.
Regularly review the amount you are covered for
You can amend the amount of cover you have for your home at any stage during your policy period. The Sum Insured value should ideally be reviewed at least annually to consider changes to house replacement costs, which can be influenced by inflation, general house values or increased building costs and materials. It is up to you, the policyholder, to ensure you are comfortable with the Sum Insured value noted on your policy.
Combined house and content insurance options
It is usually a good idea to have your House and Contents insurance with the same insurer. This avoids any gaps in cover should you need to make a claim under both policies, for example in the event of an earthquake. In some cases, it may also mean only needing to pay one excess in the event of damage under both policies from one event; however, you would need to discuss this with your insurance broker as not all insurers will respond in this way.
Generally, your content insurance covers amongst other things, all furniture and furnishings, clothing, carpets, blinds and curtains and personal belongings such as jewellery, sporting equipment etc. Some categories of items which are over a certain value may need to be specified on the policy, for example higher-value jewellery or bicycles. Your broker will be able to advise what needs to be specified, and what is automatically covered under the general Sum Insured value.
Seek advice from an insurance broker
For many homeowners, it can be difficult knowing what type of policy you need for your property and what excess will apply should you need to make a claim.
Your insurance broker will be able to assist you with understanding what options are available to you through their relationships with multiple insurance providers and what level of insurance and excess you require taking into consideration your unique personal circumstances.
To find out more how an insurance broker can assist you with your house insurance, contact your local NZbrokers member today. They are local, so will understand your unique needs.