Against the backdrop of the recent natural disasters in Victoria and Queensland and results from a survey which suggested that:

• 27.5% of home contents were underinsured by 10% or more, and
  
• 7.5% of home buildings were underinsured by 30% or more*

CEO here at Real Insurance, Roger Grobler says “While most Australian homeowners recognise and appreciate the value of house and contents insurance, getting a good policy these days takes effort and careful planning.”

“When things do go wrong it often revolves around a personal or natural disaster which is not only traumatic but can be financially devastating if the affected parties do not have the necessary household and contents cover.”

“Unfortunately it is very often during these times that most homeowners discover they are either not sufficiently covered or that they are underinsured.”

Here are five key things you should consider when taking out house and contents insurance:

1. Shop around.
2. When comparing quotes ensure that you compare like for like cover.
3. When determining the sum insured, the figure should include the rebuild cost of your home, not including land value, but including allowances for the clearance of debris from the land in the event of a total loss. If you are unsure of the replacement cost you can consult a builder or architect and they should be able to assist you.
4. You must make reasonable efforts to maintain your house and contents in a good state of repair and condition. Any loss or damage caused by poor maintenance may not be covered under your insurance.
5. Review the replacement value of your property regularly. If you do not review the replacement value of your home and contents regularly, and increase your cover where appropriate, you may be under insured.

*Insurance Council of Australia, Report on Non-Insurance/Under-Insurance, p. 20