Policy Wordings – not the most interesting read of the day! But an Essential Read non-the-less. Take the time and read your policy – take notes of what your not sure about and ring your Insurer or Broker for the answers.
Are you covered for Gradual Deterioration? – on rental dwellings probably not! – but if you do have some cover: it will only be up to a specified amount, only if it was unforseen, and only if you have attended to it immediately upon noticing! So make sure you do those periodic inspections. Check the roof, especially after a storm. Tile and slate roofs can slip out of position. Tin roofs are secured by screws and washers, with the expansion and contraction due to the change of temperature these can come loose.
Keep records of your possessions and take photos or videos of the more expensive items or collections etc. Valuations should be updated every five years. Keep copies off site in case of fire, or have you checked out fire retardant safes. You can purchase a fire retardant safe from places like McCarthy Locksmiths and Mitre 10 starting from around $200.00. They are great for keeping your passports, policy wordings etc in as well.
Did you know that if your carpet is not glued to the floor (e.g. it is tacked down) then it is not covered under your dwelling. It is part of your contents or landlords furnishings. Have you accounted for this in your sum insured?
For your personal home contents remember, if your policy is for replacement then you must calculate the values on the replacement value of the items. Your fridge may only be worth $300 as it is, but if your cover is for replacement then the value of your fridge for Insurance purposes is the cost to purchase a new one.
However, for your landlord’s furnishings, this is covered only for Indemnity value. What is indemnity value – it is defined as the replacement value less depreciation based on the age and use of the item. Another way of looking at it is the current second-hand value of the item, with both the age and condition always being taken in to account.
Always advise your Insurer or Broker of any changes. Are you redecorating your rental property between tenants so it is going to be unoccupied for a period of time? Then you MUST advise your Insurer or Broker of this. Cover is not extended to unoccupied dwellings past a specific period of time unless agreed by the Insurer. This also goes for your own dwelling, if you are having an extended holiday – have you let your Insurer or Broker know.
Additionally, are you making any renovations? Your property may not be covered if you are renovating dependant on how extensive the work is. Again contact your Insurer or Broker and check if it is OK, or if you need to look at a policy to cover for those renovations. You are not automatically covered under the builder’s policy.
Remember, your Broker is there for you. To make sure you have the best policy for your needs at a competitive cost and to ensure you understand what your policy is about! If you have any questions, you need to ring and get them answered. Asking the question at the time of your loss can just add stress at time when you’re probably already close to maximum. Make sure you know what you are covered for.
Article provided by Judith Duncan
Crombie Lockwood (NZ) Limited