Invest in Peace of Mind - Protect Your Home

Types of Home Insurance Available

Home insurance in New Zealand falls into two broad categories:

• Building Insurance - It covers the structure of your home, like walls, floors, and roofs. Building insurance comprises any permanent fixture such as garages, sheds, and fences. In this respect, building insurance has to be necessary there as it will cover costs for repairs or rebuilding events such as fire, storms, or vandalism.
• Contents Insurance - This will range from furniture and appliances to gadgets and all the clothes. This kind of insurance will protect your belongings from theft, fire, and water damage. You can have a replacement insurance policy whereby you can replace your item with a new one when destroyed and not get the secondhand value of the item but instead the price of a new replacement.

Full Replacement versus Sum Insured

To select a home insurance policy, one needs to understand the difference between full replacement cover and sum insured cover.

• Full Replacement Cover - This is the type of policy that guarantees to rebuild your home to its previous state no matter what the total cost would be. In reality, while this provides the greatest protection, it is usually extremely expensive and thus not as frequent in New Zealand.
• Sum Insured Cover - Under this policy, your home is covered to a predetermined sum insured amount. You will be required to estimate the cost of rebuilding the house with materials, labour, and professional fees. This needs regular review to consider building inflation and increasing building costs

Common Exclusions in Aussie Home Insurance

With Aussie home insurance, you're really well covered, but there are a few things it doesn't cover. That includes normal wear and tear, infestation of pests, and deliberate damage. If your roof starts to leak or your pipes burst because they are old, then in most cases, you are not covered. You have to keep your place in good nick. Termites and other critters causing damage? That's usually not covered, either, because such problems can often be avoided by performing regular maintenance. And if you or your tenants intentionally damage your home, well, don't look to insurance to cover that, either.

What Affects Your Aussie Home Insurance Costs

Several factors come into play to determine the cost of your Aussie home insurance premium. High-risk homes, obviously those in flood zones, bushfire zones, or near the coast-cost more for premiums due to their dangerous vulnerability from natural disasters. Older homes may fall into a slightly higher price category due to aging infrastructure or outdated safety features. Having security systems installed, as well as smoke alarms and fire extinguishers, will help keep your premiums at a minimum. Then, your rates may be higher if you've filed many claims in the past.

How to Estimate Your Home's Sum Insured Correctly

Correctly estimating your home's sum insured is a way of avoiding underinsurance; it includes all rebuilding costs, including materials, labour, and demolition. If your house has some form of specialty architectural feature or high-end finishes, make sure to include those in your estimate, too. Also, add in the council fees and approvals because when one is rebuilding, these are sure to add up. Online calculators and professional advice will provide as close to an accurate rating as possible to determine just what your property requires.

Conclusion

Home insurance provides the most basic security to your house and its properties from perils due to natural calamities, theft, and possible accidental damage. Understanding the types of cover, such as building insurance, contents insurance, full replacement cover and sum insured cover, would help you in selecting the right policy.