WAKE-UP CALL: Darren Robbins from Herron Todd White says adequate insurance is essential CYCLONE Yasi should provide a wake-up call for homeowners to insure their property to its current replacement value, according to independent property advisers Herron Todd White.
The firm’s residential director, Darren Robins, said many homeowners would have faced financial disaster if Yasi had hit Townsville with its full force, as i t d i d i n Cardwell, Tul l y , Mission Beach and Innisfail.
Mr Robins said homeowners should check that their insurance payout would cover the true replacement cost of their property.
‘‘ Weather forecasters have warned that the cyclone season may be far from over,’’ Mr Robins said.
‘‘ As we saw with Yasi, cyclones can flatten properties and leave an enormous clean-up bill. Townsville dodged a bullet with Cyclone Yasi and it serves as a reminder to make sure our properties are protected with an up-to-date level of insurance cover.
‘‘ The price to replace a home, which includes costs associated with demolition and site clearance, has increased dramatically over the past decade so even if your insurance cover was up to date five years ago, the chances are there would be a price shortfall.’’
Insurance providers use information from a practice known as a Replacement Cost Estimate to calculate the premium for defined risks and to set the limit of indemnity on which the insurance is based.
‘‘ Along with determining a figure that would allow you to replace your current home in the act of an insurable disaster, Replacement Cost Estimates also allow for any escalation in cost up to the disaster date, which can often be substantial,’’ he said.