Buying insurance can be a scary and daunting task to take on for the first time. Here is the run down of things you need to know about Building and Contents Insurance.
Building Insurance is normally part of your Mortgage agreement because the Bank requires you to protect their financial interests.
What is Building Insurance?
Building Insurance generally covers the actual structure of your house including things like: spas, fences and gates, fixtures and fittings, built in furniture and outbuildings such as a separate garage.
Building Insurance will not normally cover items such as pool covers, carpets, rugs, curtains, internal blinds, vehicles, tents, caravans or watercraft. Basically any property that can be detached without using a tool is not covered.
CONTENTS INSURANCE
Contents Insurance generally insures the contents of your household. Contents insurance usually costs more than building insurance for each $100 insured, because burglaries are more common than fires. Your bank will not insist on your taking out contents insurance but it is important for you
to do so.
You may be able to afford to replace one broken or stolen item in the home but could you afford to replace all your electrical and white goods at the same time?
Contents insurance covers things like household goods including furniture, household electrical appliances and equipment, carpets and rugs, curtains, blinds, potted plants, personal effects such as jewellery and cameras.
Usually not included in contents: motor vehicles, caravans and trailers.
OWNERS AND OCCUPIER LIABILITY
Owners and Occupiers liability is usually included in a homeowner’s policy to cover your liability if you are negligent, to pay compensation for injury to persons and damage to property.
Occupier’s liability: For example, an object in the middle of your hallway is the cause of someone having a bad fall. Without insurance imagine the heartache of trying to pay the lifetime income of a friend who tripped on your child’s toy and was totally disabled. This may seem unlikely but ‘accidents do happen’!
Building owners liability: For example, a visitor falls because of a defective step leading from your front verandah. Their resulting broken ankle is your responsibility and insurance will cover any costs relating to the accident.
Choosing the right insurance product does not have to be hard.
Let your fingers do the walking and arrange for quotes over the phone, or look up different policies over the Internet. Stick to established, well- known companies for security. Here are some places to start:
AAMI INSURANCE
WEB SITE www.aami.com.au
Phone: 132244
Product: Home Insurance
CATHOLIC CHURCH INSURANCES
Web site: www.ccinsurances.com.au
Phone 1300 655 005
Product: Home & Contents Insurance
CGU INSURANCE
Web site www.commercial-union.com.au
Phone 1300 362 893
Product: Blue Ribbon Home Insurance; Home Insurance
GIO INSURANCE
WEB SITE: www.gio.com.au
Phone. 131010
Product: Spotlight Home Insurance
RACV INSURANCE
Web site www.racv.com.au
Phone: 131955
Product: Prime Cover Home & Building Insurance; Home and Building Insurance
ARE YOU FULLY INSURED?
Below are some typical traps to be aware of.
What to look for in an insurance policy:
- New for old replacement with contents
- Cover outside the home, jewellery, sporting equipment, cameras (Optional cover is available)
- Cover outside the building, theft in your car
- Damage to fences, gates etc.
- Office equipment usually has a limit of $5000 to $10,000 – therefore your home office may need additional cover.
- Tools of trade usually have a limit of $500 to $1000 – therefore your business tools may need additional cover.
- Items may need to be listed such as jewellery, antiques or works of art if they are valued at over $1000 per item or $3000 in total.
- Flood cover is usually EXCLUDED in most policies, and it is best to check your individual circumstances with the insurance company.
HOW MUCH INSURANCE DO I NEED?
To work out how to calculate the value of your property and contents contact your insurance company or agent. They will guide you and have checklists and formulas to make it easier.