Leap in household contents insurance

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linw

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#306457 24-Jul-2023 16:27

Whow, looks like the flooding Ins Co payouts are being spread to everyone, regardless of threat.

State has increased ours by 40% ($519 to $725 for 52 grand cover). Where we are there is zero chance of floods or landslides or forest fires.

I guess I might save $50 if I halved the cover!!

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#3107631 24-Jul-2023 16:38

And then you discover that your policy has an "average clause", so that when you lodge your next claim, they only pay 50% of it's value 😟

networkn

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#3107632 24-Jul-2023 16:42

You aren't paying your insurance alone, you are paying the mean of the total risk to the insurer for providing insurance to it's customer base.

Floods alone have affected insurers a significant amount, and whilst I understand it sucks, the consequence is that overall their risk has increased significantly and they are having to increase premiums to continue to be in business and profitable.

My car insurance on a 3 year old car, is about $300 more than it was when I purchased the car brand new and it's value was $40K more.

Be aware that if during a claim, they determine you have $200K of contents and you are paying premiums on $100K then they will only pay out half the amount of your claim, even if it's under the 100k you are insured for.

mattwnz

20141 posts

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#3107644 24-Jul-2023 17:14

networkn:

You aren't paying your insurance alone, you are paying the mean of the total risk to the insurer for providing insurance to it's customer base.

Floods alone have affected insurers a significant amount, and whilst I understand it sucks, the consequence is that overall their risk has increased significantly and they are having to increase premiums to continue to be in business and profitable.

My car insurance on a 3 year old car, is about $300 more than it was when I purchased the car brand new and it's value was $40K more.

Be aware that if during a claim, they determine you have $200K of contents and you are paying premiums on $100K then they will only pay out half the amount of your claim, even if it's under the 100k you are insured for.

Except some have moved to a more based insurance for house insurance. Such as if you live in a higher earthquake or flood risk area, you can end up paying a lot more. Not sure why the same wouldn't apply to contents.

rb99

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#3107647 24-Jul-2023 17:30

Nothing wrong with a bit of collective responsibility...

“The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.” -John Kenneth Galbraith

rb99

Wheelbarrow01

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#3107733 24-Jul-2023 23:13

Ya just got my car renewal from State - $150 more per annum for $5k less cover. I did the usual shop around but unfortunately could not find anyone cheaper on similar terms.

My home and contents is coming up for renewal in December - looking forward to that.....

sir1963

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#3107770 25-Jul-2023 08:24

Because all insurance companies cross insure each other.

So disasters in the USA impact premiums here
Insurance companies also monitor future risk, so they do not care if you believe in climate change or not, they do.
And because of this reality they are looking at future risks and will be building up a nest egg to cover it, failure to do so will just result in the collapse of the insurance industry .

blackjack17

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#3107810 25-Jul-2023 10:42

networkn:

Be aware that if during a claim, they determine you have $200K of contents and you are paying premiums on $100K then they will only pay out half the amount of your claim, even if it's under the 100k you are insured for.

There is no mention of an average clause in AAs content insurance policy documents

https://www.aainsurance.co.nz/manage-policy/policy-documents/contents-insurance-policy-document-before-22-may-2022

I did find mention in a vero document https://www.vero.co.nz/documents/marine/change-document-move-new-zealand-2019.pdf

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networkn

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#3107858 25-Jul-2023 13:03

blackjack17:

networkn:

Be aware that if during a claim, they determine you have $200K of contents and you are paying premiums on $100K then they will only pay out half the amount of your claim, even if it's under the 100k you are insured for.

There is no mention of an average clause in AAs content insurance policy documents

https://www.aainsurance.co.nz/manage-policy/policy-documents/contents-insurance-policy-document-before-22-may-2022

I did find mention in a vero document https://www.vero.co.nz/documents/marine/change-document-move-new-zealand-2019.pdf

Give them a call and ask them what happens if you under insure :)

Handle9

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#3107901 25-Jul-2023 15:02

networkn:
blackjack17:

There is no mention of an average clause in AAs content insurance policy documents

https://www.aainsurance.co.nz/manage-policy/policy-documents/contents-insurance-policy-document-before-22-may-2022

I did find mention in a vero document https://www.vero.co.nz/documents/marine/change-document-move-new-zealand-2019.pdf

Give them a call and ask them what happens if you under insure :)

They’ll payout as per the policy or you’ll go to court. Insurance companies don’t get to make up clauses that aren’t in the contract.

networkn

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#3107912 25-Jul-2023 15:58

Handle9:

They’ll payout as per the policy or you’ll go to court. Insurance companies don’t get to make up clauses that aren’t in the contract.

Sure, except it would be pretty easy to miss something like this from a policy document, esp if it's obfuscated in technical or legal terms.

Asking in plain terms and getting the response as a plain terms yes or not, ensures all parties are clear on what will happen during a claim.

duckDecoy

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#3107972 25-Jul-2023 16:37

As mentioned elsewhere, our latest bill for home and contents is up 19% from last year.

duckDecoy

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#3107974 25-Jul-2023 16:42

networkn:

Be aware that if during a claim, they determine you have $200K of contents and you are paying premiums on $100K then they will only pay out half the amount of your claim, even if it's under the 100k you are insured for.

how would they know? I used some online tool AA pointed me at which was all very vague and simple, sort of like "do you have a crummy kitchen, an average kitchen, or a top end kitchen" I'd hate to think I would fall foul of the above given they pointed me at it and told me to use it.

bigmacpaddy

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#3107977 25-Jul-2023 16:59

duckDecoy:

networkn:

Be aware that if during a claim, they determine you have $200K of contents and you are paying premiums on $100K then they will only pay out half the amount of your claim, even if it's under the 100k you are insured for.

how would they know? I used some online tool AA pointed me at which was all very vague and simple, sort of like "do you have a crummy kitchen, an average kitchen, or a top end kitchen" I'd hate to think I would fall foul of the above given they pointed me at it and told me to use it.

I think the wording here is not quite right, but definitely something to be aware of.

If you insure for 100K (but have 200k worth of stuff) and you have a total wipeout of all your contents they will pay 100K as per your policy amount.

If you insure for 100K (but have 200k worth of stuff) and you make a claim against your policy for 20K they will only pay out half (or relevant percentage of what they claim you have).

That's how i understand it.

I guess in the second instance because you haven't totally lost everything, they can do an insurance inspection on all your contents before paying out the relevant amount.

Someone else will probably understand/explain it better.

mattwnz

20141 posts

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#3107979 25-Jul-2023 17:04

duckDecoy:
networkn:

Be aware that if during a claim, they determine you have $200K of contents and you are paying premiums on $100K then they will only pay out half the amount of your claim, even if it's under the 100k you are insured for.

how would they know? I used some online tool AA pointed me at which was all very vague and simple, sort of like "do you have a crummy kitchen, an average kitchen, or a top end kitchen" I'd hate to think I would fall foul of the above given they pointed me at it and told me to use it.

Isnt a kitchen covered by the home insurance and not the contents insurance?

linw

2849 posts

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#3107997 25-Jul-2023 18:26

Interesting discussion. Out of curiosity I got a quote from AA and it was very close to State. No great surprise there.

Guess we all have to bear the burden of climate change disasters.

Won't help families worrying how to pay the next rent or mortgage payment, though.

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