Upgrading your home insurance could potentially be essential due to changing circumstances or risks.
In today's world, it's essential to ensure that your home and its contents are adequately protected against unforeseen events such as fire, flood, storm, or theft. As our lifestyles and possessions evolve, so too should our home insurance coverage.
Portable items like phones, laptops, surfboards, golf clubs, and other holiday items may require additional coverage under a Portable Items Cover to extend protection beyond your home. It's crucial to check if new computers, tablets, home office equipment, home entertainment systems, exercise equipment, fitness wearables, kitchen appliances, and other high-value items are covered by your home insurance policy each financial year.
Sentimental and high-value items such as watches, jewellery, and family heirlooms should also be accounted for in your home and contents insurance coverage. Gifts and large purchases may necessitate an update to your insurance to ensure adequate protection.
Renovations, extensions, and significant home improvements can drastically increase a home's value, necessitating an update to your home insurance coverage. To estimate the additional value needed for insurance coverage after renovations, add up the costs of demolition, debris removal, materials, rebuilding fees, and any reasonable fees for an architect, engineer, or surveyor.
Living in Victoria, a region prone to severe weather events, makes updating your home insurance coverage even more crucial. Natural events like fire, flood, hail, severe storms, summer bushfires, golf ball-sized hail, and earthquakes can cause extensive damage and require updated home and contents insurance coverage.
In areas prone to extreme weather, it's important to evaluate your deductible amounts for specific perils and consider endorsements that cover additional risks. Insurers may raise premiums or exclude coverage in high-risk zones, so staying informed and possibly purchasing additional coverage (such as flood or windstorm insurance) is crucial.
Changes in personal circumstances, such as getting engaged, undertaking a home renovation, taking a new job, or participating in a new hobby or interest, may also require updating your home insurance. RACV offers a Home Contents Insurance calculator to help estimate the cost to replace home contents.
To protect against financial loss from extreme weather events and theft, proactively review and adjust your policy to reflect changes in your home's value, risks, and assets. This involves several key steps:
- Review and Increase Dwelling Coverage: Due to inflation and rising rebuilding costs, ensure your dwelling coverage matches the current replacement cost of your home, not just market value, especially after renovations or home improvements.
- Account for Changes in Circumstances and Renovations: Major home renovations or expansions increase the cost to rebuild and may require updating your coverage limits. Inform your insurer about significant changes, including additions or upgrades.
- Add Coverage for Gifts, Large Purchases, and Valuable Portable Items: High-value items like jewelry, electronics, or gifts often exceed standard personal property limits and may need to be scheduled separately on your policy with appraisals to ensure adequate coverage, sometimes under a "personal articles floater."
- Protect Against Increasing Frequency of Natural Disasters: In areas prone to extreme weather (e.g., hurricanes, wildfires), evaluate your deductible amounts for specific perils and consider endorsements that cover additional risks.
- Regularly Reassess Policy and Risk Exposure: Because natural disasters are becoming more frequent and severe, regularly update your policy annually or after any lifestyle changes, such as acquiring new valuables or making changes to the landscaping or outbuildings which might affect risk.
- Consider Additional or Specialized Coverages: For portable items frequently taken off your property, like cameras or laptops, verify if coverage extends off-premises or requires special endorsements.
In summary, keeping your home insurance aligned with your current risk and possessions, particularly due to inflation, renovations, gifts, and climate-related risk increases, means proactively informing your insurer of changes, getting appropriate appraisals, increasing coverage limits as needed, and exploring supplemental policies or endorsements targeting theft and extreme weather.
The end of the financial year is a good time to review and update your home insurance policies to ensure you're adequately protected against the increasing severity and frequency of extreme weather events.
- To safeguard your treasured items like family heirlooms and valuable jewelry, ensure they are included in your home and contents insurance coverage, just as important items in your home-and-garden might need additional coverage under a Portable Items Cover.
- As our lifestyles and possessions evolve, so should our home insurance coverage – this includes updating policies to account for changes in our home-and-garden, such as new appliances, home office equipment, or fitness wearables, to ensure they are covered annually.
