So why can’t I just file away this policy like usual?

There are a few things you need to check first

What you need to do

When it’s time to renew your home insurance or take out new home insurance, you should consider the amount your home will be insured for. If your home insurance is underwritten by IAG, this amount is called the Sum Insured, which should reflect the likely cost of rebuilding your home. That’s why we encourage you to check the Sum Insured provided on your Policy Schedule and notify your insurance provider if you think it requires adjustment.

Estimate the likely cost of rebuilding your home

There are several ways you can estimate what it could cost to rebuild your home.

  • Use our calculator

    Use the calculator on this website – it’s free, easy-to-use and only takes a short time to complete. But remember, the amount produced by the calculator does not replace an insurance valuation undertaken by a professional. It is an estimate only, intended as a guide to help you decide how much to insure your home for, and is not suitable for extremely large homes (in excess of 700 square metres) or high value homes where the likely cost of rebuilding would exceed $2 million.

    Get started now

    Work out the answers first

  • Ask a licensed builder or quantity surveyor

  • Ask a valuer

Remember, if you decide to engage a building professional, costs may apply.

What existing homeowners need to do

If you already have home insurance that’s underwritten by IAG, you should check the Sum Insured specified on the Policy Schedule that comes in your insurance renewal pack. That figure is based on some of the information held by us about your home. This information could include its location, age, floor area and construction type.

Some home insurance policies may require the insurer to adjust the Sum Insured for inflation, but others may not. IAG-underwritten policies do not require adjustment for inflation, but at renewal time (or less frequently), we may decide to adjust your Sum Insured amount anyway.

Adjustments could be based on the Capital Goods Price Index: Dwelling and Out Buildings, or on some other information. If this, or any other adjustment, has been made to your Sum Insured amount, your new Policy Schedule will contain the new amount and your premium will have been calculated accordingly. Any inflation adjustment made might not actually be enough, so it's still a good idea to review your Sum Insured amount at each renewal.

Didn't review the Sum Insured last time?

If you chose not to review your Sum Insured at the last renewal, then doing so at the next renewal is a good idea. If your Sum Insured is the one initially provided by your insurance provider, this figure may not provide you with enough cover. This is because it is based on some of the information held by your insurer about your home, which might not be up-to-date (for example, if you have made alterations to your house).

Also, other information that you haven’t previously been asked to provide or that hasn’t been used to calculate the Sum Insured amount may affect the likely rebuilding cost. Two examples of this are the slope of the land your home is built on and the quality of your home – your insurance provider may not hold this information or it’s incomplete. In this case the Sum Insured amount provided may have been based on an average/ordinary build quality and on the home being on flat land. If either of these assumptions is incorrect it could affect the cost of repairing or rebuilding your home, so you may need to adjust your Sum Insured amount.

Did review the Sum Insured last time?

If you chose to review your Sum Insured at the last renewal, then the amount that shows for this renewal will be the one you chose, presumably with any adjustment for changes in building costs as described above.

For these reasons you should check the Sum Insured provided on the Policy Schedule. Then you should estimate the likely cost of rebuilding your home to its current specification, so you can decide if the Sum Insured provided in the Policy Schedule is appropriate or needs to change. If you want to change it, contact your insurance provider.

If you’re comfortable that the Sum Insured is right for your home, you only need to pay your renewal premium. In that case, the Sum Insured on your Policy Schedule will automatically become your Sum Insured for the applicable policy period or until such time as it is changed.

What new homeowners need to do

If you’re buying a new home it’s just as important that you estimate the potential cost of rebuilding it as this amount is probably different from the price you pay for the property. You should then insure your home for the likely cost of rebuilding it. That will become the Sum Insured that’s specified on your insurance Policy Schedule and the maximum amount payable to repair or rebuild your home.

Homeowners with insurance brokers

If your home insurance is arranged through a broker you should still estimate the potential cost of rebuilding your home and compare it with the Sum Insured on your Policy Schedule. You should then discuss this with your broker.

Where to find help

If you have concerns about setting your home’s Sum Insured or estimating the potential cost of rebuilding your home, you can consult with an expert in rebuilding cost, such as a registered valuer, quantity surveyor or licensed builder. Costs may apply.

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