The Insurance Council of Australia (ICA) estimates that around one third of insured homes are underinsured by at least 10%. That’s scary when you consider for most people the family home is their largest asset.
Many people are extremely busy these days, so it’s understandable that they simply pay the policy when it becomes due without considering the amount insured. Building costs are constantly increasing , you may be surprised at the cost to re-build your home. Home improvements also increase the value of your home, a new kitchen or bathroom should trigger an increase in the sum insured.
A new TV, Fridge or washing machine will impact the combined value of your contents. Don’t forget to review new additions to home contents when considering the replacement value of your home and it’s contents.
Don’t get caught out
It’s a good idea to read your policy in order to understand the coverage you have. Common things to look for are; coverage for storms, floods, flash floods and bushfires. Be sure to understand what your insurer’s definitions for these include and how that definition may impact a potential claim.