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Tips To Insure Your House and Content
How much insurance cover is adequate on your home?
The sum insured is the maximum total amount an insurance company will pay to repair or to rebuild to a customer’s home. Therefore, it is important for customers to check their sum insured and to make sure it is enough to cover them should they need to rebuild. There are some ways to help calculate this insurance sum.
- Using the Cordell Calculator tool to obtain a rebuild estimate. The Cordell Calculator is an independent online tool that calculates how much it might cost to rebuild your home. The calculation is based on information from a variety of third party sources and typical rebuild costs for homes with similar materials and features.
- Getting a registered professional to assess the rebuild costs. A qualified professional like a registered valuer, quantity surveyor, licenced building practitioner or other specialist an insurer accepts can assess the estimated rebuild cost. Getting expert advice ensures that all the unique aspects of the house are taken into account.
For further information visit https://www.vero.co.nz/personal-insurance/house-insurance/cordell-calculator.
Why there is a need to review your sum insured every 2-3 years?
Customers may be surprised to see that insurance premiums are on the rise each year, but easily neglected the sum insured of the property. The reasons for the review are that:
- Market inflation pushes up prices for repair or rebuild;
- There are increased claim risk from natural peril events. The weather events of 2023 have further exacerbated this
- Quite high percentage of properties in New Zealand are under-insured;
- Taking into consideration the current rate of inflation and the cost of rebuilding and repairing domestic buildings and contents in New Zealand, Vero insurance made a sum insured adjustment rate of 12% for homes and 7% for contents last year. But this still may not be enough for some customers.
How to make use of the SumExtra benefit from Vero Insurance?
Vero SumExtra benefit means extra cover for no extra cost. It will provide:
- Up to 10% more cover for natural disasters. If a home is damaged or destroyed in a natural disaster (such as an earthquake or tsunami) and the Sum Insured amount isn’t enough to pay for repairs or a rebuild, SumExtra kicks in with up to 10% extra.
- Full repair or replacement cover. If a home gets damaged or destroyed by any insured event other than a natural disaster, SumExtra will help cover the costs to repair or replace a home—even if the cost is more than the Sum Insured amount.
To qualify for Vero SumExtra:
- The sum insured or the estimated cost of rebuilding is calculated by Cordell Calculator or the advice of a registered valuer;
- Keep a copy of the written cost estimate in a safe place as one will need it to obtain the SumExtra benefit;
- The cost estimate should be less than three years old at the time it was last agreed;
- If you don’t currently qualify for SumExtra, it’s easy to put right. Just work out the Sum Insured amount for your home using one of the methods above mentioned.
Don’t forget you need to actively recalculate your sum insured every three years using one of the approved methods – it’s easy with the Cordell calculator. If you need to adjust the sum insured on your policy, contact your broker or adviser and remember to keep a copy of your calculation in a safe place.
Contents sum insured:
The cost of household items can change quickly, so it’s a good idea that customers check their contents replacement costs regularly and adjust their sum insured if required. Their premium is based on their sum insured, and it represents the maximum amount an insurer will pay to repair or replace their contents. Customers can obtain an estimate using an independent online contents calculator tool on insurer’s website, where they can review a list of common household items and values, and adjust or add details appropriate to their own circumstances.
For Vero insurance, please visit https://www.vero.co.nz/personal-insurance/contents-insurance/contents-calculator.
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