What's all this talk about Sum Insured?

It's about knowing how much insurance you have

What you need to know

In New Zealand today, many homes are insured for a maximum specified amount. If your home is insured on a policy underwritten by IAG, this is called the Sum Insured on your home insurance Policy Schedule.

Why the Sum Insured approach

A number of reinsurers who provide natural disaster cover to many New  Zealand insurance companies require homes in New  Zealand to be insured up to a specified amount, because they want to know the maximum cost insurers would have to pay to rebuild the homes. IAG meets that requirement by using the Sum Insured approach.

Here are the things you’ll need to know about your house

(Roll your cursor over the hot spots to learn more)


Home’s age
Whether your home is a villa, bungalow, relatively new standard-designed home or a one-off architectural design, the cost of rebuilding it would differ from what it cost to build it originally.


Standard of construction
A higher specification home will probably be more expensive to rebuild than another house that’s the same size but built more simply.


The slope of the land your home is built on can affect how much it would cost to rebuild.


This is usually covered in your home insurance policy so you should include it when estimating the likely cost of rebuilding your home.


Recreational Features
Tennis courts, permanent swimming pools and permanent spa pools are automatically covered in some IAG-underwritten home policies up to a specified amount called a policy limit or cover limit. You can purchase additional cover if you decide you need more. If your IAG-underwritten home policy does not automatically cover these features and you want them covered, then cover will need to be purchased.


Special Features
These are defined in IAG policies as bridges, culverts, permanent fords or dams, wharves, piers, landings or jetties, cable cars, and private utility plant including wind or water mills and diesel generators. They are not automatically covered by home policies underwritten by IAG so you’ll need to specify a separate Sum Insured amount for these if you’d like them covered.


Retaining walls
Under home policies underwritten by IAG, cover for retaining walls is limited or not automatically provided. You can purchase cover or an additional level of cover over and above the policy limit or cover limit.


Kitchens and bathrooms are usually the most expensive rooms in your home to rebuild, so it pays to take some extra care with these rooms when working out what it could cost to rebuild them.


Rebuilding a split-level or multi-storey home is often more expensive than rebuilding a single-level home.


Floor area
The bigger your home the more it will cost to rebuild. When working out what it could cost to rebuild, don’t forget to take into account all the levels in your home.


Floor Construction
Your floor may be constructed from a poured concrete pad, tongue & groove floorboards, particle board or plywood. The type of construction, along with any fixed floor covering, will affect what it could cost to rebuild your home.


Materials can include terracotta or concrete tiles, metal, tin or colour steel, fibre cement, shingles or slate. Any newly rebuilt home must also include insulation in the roof space.


Exterior walls
These can be made of timber, brick, block, stone, mudbrick or modern cladding products such as EPS or artificial weatherboard. These all cost different amounts, and if you had to rebuild you’d need to allow for insulation in the wall too.


Sealed or paved driveways are covered under home policies underwritten by IAG but shingle or gravel driveways are not covered. In the calculator you can enter the width and length of your sealed or paved driveway to include it in your calculation.


Garages and carports
These should be included when you estimate the likely cost of rebuilding your home.


Today’s building code may require newly rebuilt and repaired homes to use double glazing. The calculator assumes double glazing will be required when estimating the likely cost of rebuilding.


When estimating the cost of rebuilding your home remember to include all your fencing, not just the fencing around your boundary, as well as your portion of any fencing you may share with your neighbours.


Trees and other plants
Home policies underwritten by IAG do not cover these but may include an amount for landscaping in some situations. It’s best to check your Policy Wording for details.


Water tanks
These are covered under your IAG home insurance policy and should be included when estimating the likely cost of rebuilding your home.


Any permanently laid paving is covered by IAG-underwritten home policies so you should include it when estimating the likely cost of rebuilding your home. Shingle and pebble areas are not covered.

Who is affected

Insuring a home for up to a maximum specified amount affects all homeowners whose home insurance is underwritten by IAG as well as home buyers who are about to insure a home with IAG. If you are with another insurer, you might also have Sum Insured home insurance.

It applies to all types of homes - townhouses, terraced houses or free-standing houses.

If you own a unit in a body corporate situation, your home may already be insured on a Sum Insured basis.

Other things to know about IAG's home insurance

Some homeowners may also be affected by policy limit or cover limit for certain home features, such as retaining walls and Recreational Features. Others may find that retaining walls and Recreational Features are not covered by their home policies, and may need to purchase cover for them. Homeowners need to contact their insurance provider to arrange cover for or increase the policy limit or cover limit for retaining walls and Recreational Features.

Special Features are not automatically covered under IAG-underwritten home policies. Homeowners need to contact their insurance provider or broker to arrange cover for any Special Features such as jetties, bridges, cable cars etc.

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