Insuring Your Nz Home: What You Need

House insurance in New Zealand can be tricky. No one wants to pay more for insurance than they have to, but being underinsured can cause problems when something goes wrong. The best way to estimate how much you should insure your home for is to use a home insurance calculator. These calculators are helpful for determining what the cost of rebuilding your home after a disaster will be. Remember that insurance only covers the cost of your policy, and the actual building costs can be higher.

The sum insured should be set at the amount it would take to completely rebuild your home – including the costs of demolishing and removing what’s left of your old house, if necessary. It doesn't include the value of your land, so it isn't the market or rateable value of your house or property.

Sum insured: The maximum amount an insurer will pay if your house is damaged beyond repair

When taking out house insurance, you will need to specify a sum insured. This is the maximum amount an insurer will pay to repair or rebuild your home if it is damaged or destroyed. It is important to get this right to ensure you have sufficient cover and only pay for the cover you need.

The sum insured should be an estimate of the maximum cost of repairing or rebuilding your home if it is damaged or destroyed, excluding any special features. This should include:

• Building materials
• Labour
• Demolition
• Compliance, professional fees and GST

Special features such as jetties, bridges over a certain value and cable cars won't be insured unless listed on your policy with a separate special feature sum insured amount. You will need to tell your insurer the rebuild value of your home without its special features and the value of those features to ensure you have enough cover for both.

You can calculate your sum insured online, using a home insurance calculator such as the Cordell Calculator or the Cordell Sum Sure calculator. This will help you to crunch the numbers in minutes, based on factors such as building materials, labour, professional fees, demolition and GST.

Alternatively, you can get your sum insured professionally assessed by a registered valuer, quantity surveyor, licensed building practitioner or other specialist. This ensures that any unique aspects of your home are taken into account.

Home insurance calculators: Use these to estimate the cost of rebuilding your home

Home insurance calculators are a useful tool for estimating the cost of rebuilding your home after a disaster. These calculators take into account various factors, such as the size of your house, building materials, demolition costs, and age, to provide you with an accurate estimate.

The Cordell Calculator

The Cordell Calculator is an independent online tool that uses council construction data on your house to calculate a rebuild estimate. It is available for over 99% of New Zealand houses and takes into account factors such as your house's size, building materials, demolition costs, and age. This calculator can be found on the Initio Insurance NZ website.

House Premium Calculator

The House Premium Calculator helps you calculate the replacement value of your house. The sum insured, or replacement value, should equal the cost to fully rebuild your house to its current size, using current building costs. This calculator can be used to determine the maximum amount you will be paid by your insurance company if your house is damaged beyond repair.

Online Replacement Value Calculators

These calculators provide a quick and easy way to estimate the cost of replacing your property by simply entering the property address. They use public data and material costs to calculate the replacement value.

Contents Calculator Tool

In addition to insuring your house, you may also want to consider insuring your possessions with contents insurance. The Contents Calculator Tool helps you estimate the total value of your possessions by breaking them down room-by-room. This tool ensures that you have enough coverage to fully replace all your items at today's prices.

It is important to remember that insurance calculators are just a guide, and it is always a good idea to consult with a professional to get a more accurate estimate. Additionally, insurance policies can vary, so be sure to read the fine print and understand what is and isn't covered before signing up.

What home insurance covers: Garages, sheds, carpets, fittings, and structural improvements

Garages, sheds, carpets, fittings, and structural improvements are typically covered by home insurance.

Home insurance covers residential buildings, including garages, and structures on your property, such as garden sheds and fences. Fixed carpets and floor coverings are also covered, as are fittings and fixtures that are permanently attached to the home, like fixed wardrobes, kitchens, dishwashers, ovens, and flooring.

Any permanent structural improvements are also covered by home insurance. This includes decks, additional rooms, and other permanent additions to your home.

It's important to note that home insurance policies can vary, so it's always a good idea to read the fine print and understand exactly what is and isn't covered by your specific policy. Some policies may have exclusions or limitations on certain types of structures or improvements.

What home insurance doesn't cover: Collapsible pools, landscaping, and curtains

When it comes to home insurance in New Zealand, there are a few key things to keep in mind. Firstly, it's important to note that the coverage offered by insurance companies can vary, so it's always a good idea to read the fine print and understand exactly what is and isn't included in your policy. That being said, here's an overview of what home insurance typically doesn't cover in New Zealand, specifically relating to collapsible pools, landscaping, and curtains.

Collapsible Pools

The coverage of swimming pools under home insurance policies can vary depending on the insurer and the type of pool. In general, home insurance may cover damage to your pool caused by specific perils listed in your policy, such as fire, lightning strikes, hail, or vandalism. However, there are some exclusions. For example, wear and tear, lack of maintenance, and failure to properly winterize your pool are typically not covered. Additionally, flooding and pool collapse due to neglect or lack of maintenance are usually not covered. It's important to note that the coverage may also differ based on whether your pool is above ground or in-ground.

Landscaping

Landscaping coverage can vary depending on your insurance provider and policy. Some home insurance policies may offer landscaping coverage as an additional benefit, often with a specified maximum amount. For example, the NZI Distinction Home policy includes landscaping coverage of up to $100,000. It's important to carefully review your policy details to understand if and to what extent landscaping is covered.

Curtains

Curtains are typically considered part of the contents of your home and may be covered under a contents insurance policy. For example, State Insurance in New Zealand offers a Home and Contents insurance policy that covers items like furniture, jewellery, TVs, and curtains. However, it's important to check the specifics of your policy, as coverage can vary.

Contents insurance: Covers furniture, electrical equipment, clothing, and more

Contents insurance covers your personal belongings against accidental loss, damage, or theft. This includes furniture, appliances, electronics, clothing, jewellery, and other items. It can be purchased as a standalone policy or as part of a comprehensive house insurance policy.

Indemnity Value vs. Replacement Cover

Understanding the difference between indemnity value and replacement cover is essential for choosing the appropriate coverage. Indemnity value considers the depreciation of an item's value over time due to factors such as wear and tear, age, and market price changes. On the other hand, replacement cover provides a brand new equivalent without considering depreciation.

Contents insurance typically covers:

• Jewellery, watches, clothing, footwear, and cosmetics
• Furniture, rugs, lamps, blinds, and curtains
• Domestic appliances not permanently plumbed or wired in
• Hearing aids, spectacles, and sunglasses
• Computers, laptops, tablets, phones, cameras, speakers, and sound systems
• Musical instruments and equipment
• Tools, gardening equipment, and domestic lawn and garden appliances
• Sports equipment, canoes, kayaks, surfboards, and paddleboards
• Cash, documents, certificates, and artificial limbs
• Portable swimming pools, saunas, and spa pools
• Works of art
• Remote-controlled models or toys
• Food in your fridge and freezer
• And more

Contents insurance generally does not cover:

• Boats and watercraft
• Motor vehicles and motorcycles
• Trailers and caravans
• Business equipment and money
• Artificial body parts, surgical implants, or attachments that are permanently fitted
• Loss, damage, liability, or expense arising from a communicable disease

Additional Coverage Options

You may also want to consider additional coverage options, such as accidental damage, fire, theft outside the home, and loss of keys.

Cost of Contents Insurance

The cost of contents insurance depends on the value of your possessions and your location. You can opt for indemnity cover instead of replacement cover or choose a higher excess to reduce the price. Shopping around and getting a multi-policy discount can also help lower the cost.

Frequently asked questions