What does your contents insurance actually cover?
Many people think that contents insurance is simply to cover the damage or theft of household possessions. However, some policies may cover you for a lot more than that.
Firstly, you must take into account chattels and fittings; not just carpets and curtains, but also your kitchen and bathroom cabinetry, stovetops, ovens etc. These items alone can come to a significant sum if they needed to be replaced.
Many advanced contents insurance policies or those with optional extras have cover for the following:
assistance if you need temporary accommodation
other’s possessions in your home
your possessions or the damage they cause to other’s possessions outside the home
the cost of defending yourself against liability or in legal proceedings for insured incidents
Wayne Tippet, IAG's executive manager of claims operations, said;
“people could be surprised by the list of things that contents insurance could help with. He said unexpected situations could have disastrous financial consequences. Young people in particular could find it difficult to get on top of any debt that arose”.
At Kauri Financial Planning, we were shocked to hear that Insurance Council research found only 72 per cent of respondents had home contents insurance. Would you have the ability to cover the replacement of your home contents?
There are various policies out there with differing levels of cover and as tedious as it may be, it is essential to read through the entire policy and fine print so that you know what it is you are actually covered for.
So often, making a claim is a stressful, long-winded, and disappointing process, because claimants have assumed that they’ve been paying for comprehensive protection. For example, it’s easy to forget to update your policy with new possessions, especially individual items that are worth over a specified dollar amount in your policy, e.g. new jewellery, artwork, or electronic devices must be reported before it’s too late. Otherwise your insurance company may refuse to replace it if it’s lost, stolen or damaged. Not only that, insurance conditions and clauses are notoriously tricky to decipher, so it’s vital that you have complete clarity around what you’re covered for and the excess costs.
Kauri can help you make sure that the value of your possessions is accurately represented, and you have certainty that when it comes time to claim, it will be stress-free and successful.