You have received your house insurance renewal in the mail, do you just save 10 minutes and renew or should you look at the 5 Things To Consider When Renewing Your House Insurance
What Should you Consider when Renewing House Insurance?
1. Rising Cost of replacement material*
With the family home being the primary asset for many Australians, it’s vital for homeowners to know the precise replacement cost. As construction costs have increased, particularly in the last 10 years, it’s important to calculate the replacement costs accurately. There are two main methods for estimating the sum-insured cost (the amount it would cost to rebuild and replace your home and contents). The ‘cost per square metre approach is based on the house size and some very basic information, but can be very inaccurate in terms of actual replacement cost. More advisable is ‘elemental estimating’, which tends to be more closely aligned to the actual cost. It takes into account different elements of a building and calculates rebuilding costs using local wage and material prices.
2. What’s changed?
Have you done renovations? Perhaps you have purchased the latest 3D Television with that stunning state of the art AV system. Have you purchased Artworks? Lifestyles change as well did we sell that mountain bike and replace it with a stroller?
Maybe last year’s decision to buy insurance was based on a budget, and you settled for fewer cover options than you would like, consider what is the optimum level of cover
3. Is the no claim benefit a real discount
Often insurers will offer a no claims discount of up to 60%, what does this really mean, most insurers will be offering you a discount on their full rate, which is reserved for people who are almost uninsurable. These NCB do not mean anything to you next insurer, what does matter is how many claims you have had in the last 5 years and what value those claims were for.
4. Check the level of cover and excess +
Check if you need more, less or the same level of cover as last year. Weigh up the difference between having a high premium and low excess versus the opposite. You may be able to save on your premium by increasing your excess.
5. Get at least three quotes
You don’t have to tell the other insurers what your renewal premium is however, it’s worth getting more than one quote. moneysmart.gov.au recommends getting at least three. Just remember that you need to compare like for like so that includes the level of cover, excesses, and inclusions.
If you are still unsure speak to one of our brokers on 1300 046 787
Home Insurance Calculators for Renewing House Insurance
81% of homeowners and renters are exposed to significant financial loss because their insurance does not cover them to resume the same standard of living in the event of a crisis^.
It is essential that you have adequate cover to help protect your home and your contents and that’s why we’ve provided these calculators. They work as guides to help you estimate the replacement value of your home building and contents.
˄Source Insurance Council of Australia, Understand Home Insurance Research Report, published August 2014
Sources *Allianz +moneysmart.gov.au
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