Combined House and Content insurance

Your Insurance options

It is usually a good idea to have your House and Contents insurance with the same insurer. This avoids any gaps in cover should you need to make a claim under both policies, for example in the event of an earthquake. In some cases, it may also mean only needing to pay one excess in the event of damage under both policies from one event; however, you would need to discuss this with your Wright Financial adviser as not all insurers will respond in this way.

Why House insurance

  • You can insure your house against sudden, unforeseen and accidental damage from all perils.
  • For most people, their house is their most valuable asset. As with all types of insurance, you have choices depending on what types of insurance best suit your needs, and how much you are looking to pay for that insurance.
  • This section notes some of the different kinds of house insurance available.

There are 3 main varieties of cover available:

  1. Fixed sum insured — the most common type of cover currently in the market. Fixed sum insurance is where you and your insurance company agree on the total sum your house is insured for. If your house is destroyed, your insurance company will pay to rebuild your house up to that dollar figure.
  2. Indemnity (present day value) — what the house was worth just before it was damaged. It is roughly equivalent to the depreciated replacement cost of the house (not including the land) taking into account its age and condition. Some older homes (such as those built before 1945) may only qualify for indemnity cover unless they have been modernised.
  3. Total replacement — a policy that means that if your house is destroyed, your insurer will rebuild or repair it up to the total number of square metres you insured it for and pay all the professional fees and demolition costs involved in the reconstruction process.

Premiums differ for each type of policy

The premium you pay for your house insurance reflects

  •  Your house’s values.
  • The cost of the reinsurance that insurers are required by legislation to hold.
  • The administrative costs of maintaining your policy.
  • Earthquake Commission levy.
  • Fire Service levies (a government tax that only insured properties pay to fund the fire and emergency service — uninsured properties get this service free of charge GST).

What is contents insurance?

Contents insurance is an insurance contract that pays for damage to, or loss of, personal possessions caused by events like fires, floods, burglary and earthquakes. Contents insurance policies are most popular with anyone including those that are renting a property. 

Summary of Our Contents Insurance Guide:

  • Contents insurance is usually most suitable for anyone including those who are renting a property and wants to protect their personal property from theft or damage, as well as cover legal liability should you unintentionally damage the home you’re renting.
  • With most policies, you’ll only be paid out if the contents are stolen or damaged by a burglary or a person unlawfully at your house – you’re not covered if the theft is by someone you have invited into your home.
  • Most policies won’t automatically cover for any loss to any contents you removed from your property, i.e. if you leave your phone at a cafe or someone steals your laptop in the library. This includes bicycles too. 

Why buy a contents insurance policy?

  • Contents insurance is an affordable way to protect your belongings from theft, damage or loss so that you can replace them.
  • If you would struggle no longer having a laptop, TV, musical instrument, linen, cutlery, even clothing, or even a washing machine, contents insurance is probably a good idea.
  • Most policies also provide legal liability should you accidentally damage other people’s property. If you don’t have contents insurance, you may have to pay for the damage out of your own pocket, which can mean considerable debt. For example, if you break something in a shop or spill a drink over a friend’s laptop, you are legally liable for the damages – contents insurance protects you from such financial loss.

What does contents insurance cover?

  • The general rule is this – if your house was turned upside down, anything that falls out of it is contents. Based on that, contents insurance covers furniture, clothing, electrical items, money and jewellery up to your sum insured.
  • New Zealanders take out contents insurance for many reasons, and with reports of burglaries at record highs and rising, a policy is the only way to protect yourself from the unpredictable.  Contents insurance protects you from financial loss if you have to pick up the pieces after a break in.

Contact us today for free no obligation financial advice.