Domestic Home, Contents & Car Insurance
Insuring the Home, its Content and the Car is normally the first step people take in protecting their assets.
General Insurance, better known as Fire & General Insurance, covers the accidental physical loss or damage to homes, their contents and cars due to sudden and unforseen incidents. To most New Zealanders their home is their most expensive, single asset acquired and insuring it should be part of their risk protection plan.
This insurance policy generally covers all domestic buildings on the property, and may include the garage, pool and fences.
Policies could be one of three types:
- Open-ended replacement cover: the house is replaced irrespective of costs
- Sum-insured replacement cover: the house is replaced to the value as stipulated in the policy document
- Indemnity (or market value) cover: the house is replaced at current market sale value. This value is generally less than the cost of rebuilding the house.
Contents insurance covers the belongings in the home or even when temporarily moved elsewhere.
Policies may include both indemnity and replacement options.With a replacement option, the item would be replaced with a similiar item of equal quality, e.g. carpet, whereas indemnity cover is based on the item’s original price, with depreciation also taken into account when final replacement value is determined. Certain items may have a maximum limit on the payout and should be detailed with proof of value (valuation certificate) in the policy document.
A compulsory Government levy is included in the premiums that is administered by the The Earthquake Commission of New Zealand (EQC). Under the Earthquake Commission Act 1993, this contributes to the natural disaster fund for homeonwers and tenants. Natural disasters such as earthquakes, volcanic eruptions, hydro-thermal activity, landslips caused by storms and tsunamis are included.Only homes, flats or other residential properties that are already covered by a Home and Contents (Fire & General) insurance are entitled to compensation from the EQC fund.
- Fire Service Levies
A Fire Service levy is included in the premiums and funds the New Zealand Fire Service in their role of protecting property against loss from fire.
Motor Vehicle, Boats and Caravans
Private cars can be insured on a full cover, third party fire and theft or third party only basis.
Premiums can be reduced by selecting a higher excess payment option. Excess payments may also vary depending on the age of the driver, especially if under the age of 25 years old.
The motor vehicle cover is based on either market value or agreed value. With market value cover, a value of the replacement vehicle has to be equivalent to a vehicle of the same age and condition as the insured vehicle, irrespective of the sum assured stated in the policy document. An agreed value policy stipulates the exact amount that will be paid out in the case of the total replacement of the vehicle.