WHY IT PAYS TO BE INSURED

Anyone who has ever had to make an insurance claim knows all too well the dubious feeling that comes over them when they pick up the phone to call their provider.

There is nothing worse than feeling you’ve been responsible and diligent by paying your insurance premiums year after year, only to discover you’re either not covered or severely underinsured when life takes a wrong turn.

Lisa Kable from Understand Insurance, an initiative of the Insurance Council of Australia, says it happens more than people may think.

“The most common mistake householders make is underinsuring their houses and contents,” Ms Kable says.

“That means they would be unlikely to be able to resume the same quality of life if the worst were to happen and their home was badly damaged or destroyed.”

Online insurance calculators are one of the easiest ways to determine whether your cover is good enough. By inputting the value of items you may not have thought of in and around the home, along with building costs, you will be able to come up with a more accurate calculation of how much cover you need.

“Householders should insure their property for the cost of rebuilding it, taking into account additional costs such as site clearance, waste removal, architect fees and council permits. This amount is unrelated to the real estate value of the property,” Ms Kable says.

When it comes to storm cover, it’s important to read the details and exclusions of the cover.

Suncorp executive manager of consumer products Josh Kelland says being smart about what to include and exclude on your policy is key.

“It’s the extra options like motor burnout for appliances such as airconditioning and water pumps for pools that customers often overlook,” he says.

“The most common recommendation I make is making sure jewellery is adequately covered and itemised.

“The second, is to make sure you know what’s covered at home versus what’s covered away from home.”

But, he says, insurance isn’t everything.

“It’s great peace of mind knowing it’s there, but it can’t beat preparedness,” he says.