Insurance is supposed to bring certainty into a homeowners life, but it appears for many the nationwide shift from traditional replacement policies to "sum insured" has brought nothing but confusion.
It's prompted the Insurance and Savings Ombudsman to come up with an information sheet to help homeowners understand the new insurance system.
Following the Christchurch earthquakes, the giant reinsurers who stand behind New Zealand house-insurers have insisted that traditional replacement house insurance policies - where a homeowner is guaranteed to have their damaged house repaired or replaced regardless of cost - are done away with.
The reinsurers were hit with bills from Christchurch far higher than they had anticipated. As a result they are requiring the introduction of sum-insured policies, where homeowners specify the maximum amount the policy will pay out.
But Insurance and Savings Ombudsman Karen Stevens says that despite the best efforts of insurers, many homeowners are confused by the change and have been ringing her office for help.
In response, the ombudsman has issued an information sheet on changes to house insurance, and to try to dispel some of the misconceptions around "sum insured".
Stevens said consumers were now responsible for estimating the costs of replacing their house, known as the "sum insured", and that sum is the maximum amount the insurance company will pay in the event of a claim regardless of whether it would cost more to replace or repair the property.
That has the potential for leaving some homeowners facing a shortfall at claims time.
Stevens said: "From the calls and complaints we are getting to the ISO Scheme, we know that many people do not understand what the change to a sum-insured insurance policy means for them.
"We have published this new Sum Insured Information Sheet to help people understand what the change means and the factors they should consider when working out the correct sum insured for their property.
"We want consumers to be well informed, make the right choices and ask the right questions. Complaints often arise when consumers don't understand the insurance cover they have and what it can do for them."
Among the suggestions the ombudsman makes to help homeowners get their sum insured right, are:
- Do not assume the price you paid for your house, or the rates valuation should be the "sum insured" you choose. The price you paid includes the price of the land, not just the building.
- The insurers all have calculators to help you work out a rough sum insured. Make sure you enter the correct details of your home. Do not estimate things like floor size.
- Read the policy carefully to see what is covered and what is not. It may be there are some things you will need to insure for separately, or for which there are high excesses, such as a tennis court, or swimming pool.
- Consider paying a professional builder or quantity surveyor to provide a double-check on the sum's recommended by the insurers' calculators.
- ? Fairfax NZ News
Comments
Source: http://www.stuff.co.nz/business/money/8867705/Sum-insured-brings-confusion
Army Navy Game john lennon leann rimes pearl harbor Jacintha Saldanha Butch Jones thursday night football
No comments:
Post a Comment