Wild Weather - is your insurance going to cover you?

Posted on 14 June 2012

In the wake of the recent severe weather pattern which has affected the coastal areas of New South Wales, now is a good time to think about your insurance cover. A surprisingly high number of households do not have any insurance coverage at all. Further many of those that do have some cover do not have adequate coverage. Do you actually know what you are, and possibly more importantly, are not, covered for? Here’s a look at what you should be considering.

It is advisable that you have your home and your contents covered to an adequate amount that would cover them should they be destroyed, damaged or in the case of contents, stolen. Your home should be covered for it’s replacement value. Should you choose not to insure it for it’s true value e.g. $100,000 instead of the true value of $150,000, you may find your insurer has the right to reduce the payout by the percentage of the under-insurance should you need to make a claim. Once you have ascertained the correct amount your home or in insurance terms, the “Dwelling” should be covered for, check to ensure that any associated buildings, “Other Structures” such as garage, shed or pool are covered or does your policy require for them to be listed separately.

Read your policy. Know what you are and are not covered for. Understand your requirements to list items separately if they fall outside the standard coverage. Not all insurance policies are the same and cover varies from company to company as well as from one geographical location to another. Check with your local council to see if there are any issues regarding this such as: fire or flood zones which may apply to your street, suburb or region. If you have owned your home for many years and your area has since been affected by a natural disaster, ensure you check that your area has not been reclassified for insurance purposes.

Contents insurance is also very important. Contents refers to personal property which belongs to you and which you are legally responsible for. Whilst you may not think the value of your household items is significant, you would be surprised how it adds up once you start a room by room list with values against each item. Imagine having to start again and fill every room as if you had lost everything. Its a good idea to keep a contents list and update it regularly. Taking photos of your contents and keeping important receipts in a safe place along with your policies and any other proof of ownership of items can be of great assistance if you ever need to substantiate a claim you may have to make. As children grow up they also tend to acquire many expensive items which, if they had to be replaced, could add up to a significant amount. Also consider factoring in inflation to the new purchase price. Some policies have a new for old option.

Another important aspect of home insurance is Legal Liability Coverage. Should an accident occur on your property, Legal Liability Coverage will cover claims against you following death, bodily injury or illness or physical loss of or damage to property caused by an accident or event. The amount of coverage should be considered but standard policies will normally cover up to $10,000,000. Imagine being without that cover should a serious incident occur on your property.

For the majority of the population, their house is the most significant asset they possess. Inside, the asset becomes a home for you and your family. Adequate insurance cover to be able to replace or repair your home and it’s contents can be the difference between heartbreak and financial disaster and being able to get back on your feet quickly after a major incident.

Should you have any problems with your insurance policies including your insurer declining liability contact us to examine the possibility of taking further legal action regarding your claim.