Like most Kiwis, your home is probably your castle and your most valuable asset. So it makes sense you would want to cover it from potential damage and related costs. That's where home insurance comes in.
Home insurance is designed to give you peace of mind should something happen to your home, because even if you’re really careful you can’t control the outcome of extreme weather, thieves or fire. Choosing an insurance provider can be time consuming task, so here are three important things you may want to consider that may save you both time and money in the long run.
1. Take a close look at the policy benefits
Home insurance gives you cover for the big events such as fire and floods, burglary and vandalism, as well as the smaller accidents like broken windows and burst pipes. Without insurance you would need to pay for the repairs or replacement of your home out of your own pocket, including any temporary accommodation should you need to move out during repairs. The details of the cover provided varies from one insurer to another, so it's important to read the policy wording carefully. As an example, here are a few of the policy benefits of our home insurance cover:
Our replacement cover: at AA Insurance, we understand that it can be difficult to calculate the exact cost of rebuilding your home. To give you greater peace of mind, we offer replacement cover, which you may qualify for if you’re one of our customers and your claim is for anything other than a natural hazard event. Replacement cover allows the full repair, rebuilding or replacement of the damaged portion of your home to the reinstatement condition, regardless of the sum insured, provided you’ve taken steps to set an accurate sum insured and size of your home.
Cover for temporary accommodation: you may also want your home insurance to include temporary accommodation for you and the people and pets you live should you need to move out during repairs.
Available optional extras: insurance policies often have standard benefits that are automatically included, and optional benefits you can add to provide additional cover at an extra cost. At AA Insurance, we offer the optional extra of excess-free glass cover on home insurance policies, which means you won’t need to pay any excess if a claim is made on glass for windows, doors and built-in furniture.
Our 'one event, one excess' benefit: Having multiple insurance policies with the one provider may save you time as you'll only need to talk to one company at claim time. It can also save you money as some insurers offer a benefit that means you'll only need to pay one excess - the highest applicable - for loss or damage caused by one event. Find out more about the benefit on our website.
It’s also worth checking for any discounts. For example, if you’re an AA Member, you can get exclusive discounts on your insurance policies with us by providing your personal AA Membership number when taking out or renewing eligible policies. Our Discount Terms and Conditions page offers more information on the discounts available to our customers, as well as information on what you need to do to receive these discounts.
2. Pay attention to the cover for legal liability
As you look through the policy documents, take note of the cover for legal liability. If you accidently cause damage to another person’s property—for example, if a fire accidentally starts while you’re cooking dinner, and spreads to your neighbour’s house—the legal liability component of your policy would cover this accident. This is up to $2 million for any one event with our Home Insurance policy, although may differ with other insurers. Without home cover, you would need to foot the bill out of your own pocket.
3. Think about the amount you want to insure you home for
Cost is often a consideration when choosing a home insurance policy. In order to estimate that cost and get a quote, you'll need to set your property's sum insured. This should reflect the cost to rebuild the house and is different to the market value of the property or how much you paid for your home. At AA Insurance, the sum insured is the maximum we will pay to rebuild your home if it's damaged as a result of a natural hazard event. For damage from other events, we may settle your claim using ‘Replacement cover’, this means that we may pay more than your sum insured to rebuild or repair your home, provided you've taken reasonable steps to provide an accurate sum insured and size of your home. That's why it's important to regularly review your home sum insured to ensure it's accurate and up to date.
There are several ways you can calculate your sum insured in New Zealand, including contacting an expert such as a builder, architect or quantity surveyor. You can also use the online Cordell Sum Sure Calculator which estimates typical building costs for standard residential houses. If your home isn’t considered typical, or is an architecturally designed home, then your most reliable source of advice would be a building expert, such as a builder, architect, quantity surveyor or other valuation expert.
Any questions?
Now’s a great time to review your insurance. We recommend checking your details are up to date and ensuring the policy and cover you’ve chosen is right for you and your insurance needs.
If you have any questions about your insurance, need to update your AA Insurance policies or would like a quote, don’t hesitate to contact us. You can find our opening hours and ways to get in touch with us on our contact page.
This blog provides general information only and is not intended to be a recommendation or personalised financial advice. Excesses, terms, conditions, limits and exclusions apply to AA Insurance Limited’s policies. Please check the policy wording for details of cover. The provision of cover is subject to the underwriting criteria that apply at the time.
