Switch and save up to 30 per cent on your home and contents insurance

According to a Finder survey of over 2,000 New Zealanders, the average person spent $352 on Christmas gifts in 2020. With a house full of new toys, gadgets, tech and sporting equipment, it is time to check your home and contents insurance has you covered for the year ahead.

Compare and count your savings

"Comparing home insurance every year can seem like a pain but it can seriously pay off. Insurers typically offer lower premiums to new customers as an incentive to sign up. That could mean a reduction of up to 30 per cent in some cases," advises Nicola.

Finder research shows 64 per cent of Kiwi households already have an insurance policy for their home and contents, but a ‘set and forget' mentality can see households paying steep premiums, without the right level of protection.

"Undertaking an annual insurance review will ensure you get a completely new evaluation of your home and contents and receive a competitive quote. You might find you're actually underinsured and would be out-of-pocket if you ever had to fully replace your homes," suggests Nicola.

Loyalty letdown

Active couple, Clare and John, were looking forward to many fun-filled driving and cycling holidays. Central to their plans were two mountain bikes fitted with the latest technology, valued at $4,000.

Devastation struck on their first trip when the bikes were stolen from the back of their SUV. Heartache soon turned into disbelief when the couple discovered their insurance policy would offer little help.

"We'd been renewing our cover every year thinking we were protected. As it turned out, the only portable item insured was our son's clarinet that had been gathering dust in the garage for nearly two decades," says Clare.

With an excess of $300 to pay and only $900 available for ‘unspecified' items on their policy, Clare and John were left well short of the replacement costs for their bikes receiving just $600.

"We now check with our provider before going on holiday to ensure our portables are covered and shop around for competitive quotes. Our experience showed us that loyalty doesn't count, it's the detail in the policy that matters," says Clare.

The pair note it's also important to read the product disclosure statement (PDS) and terms of every policy thoroughly to ensure you understand what's included or excluded.

Cover essentials

Nicola says if you want true peace of mind from your insurance policy you should compare policies by the benefits they offer, then hunt down the best price.

"Not all policies are alike. Some home contents policies have a per item limit which means you cannot claim more than a certain amount for them," says Nicola.

For example, some standard home contents insurance policies have a limit of $1,000 per any item of jewellery, which goes up to a maximum of $5,000.

It could also be worth checking and renewing your home insurance following a big-ticket purchase and listing the item separately on your insurance policy. Each insurance company will have their own requirements, so be sure to check that expensive goods are covered.

If you decide to insure specific items for a monetary value, beware this will usually increase your premium too. Same goes for adding accidental cover to your policy.

A final tip when comparing or switching your insurance policy is to ask your insurer about available discounts and savings.

"Depending on your provider you may be able to reduce the cost of your premium by purchasing it online, paying annually in advance, or by receiving a discount for having multiple policies with the same insurer," concludes Nicola.

Check the fine print on your policy for these items

• Cash-like items such as coupons, or lottery tickets may not be covered under your home and contents insurance
• Not all policies include Fusion cover, essential for replacing broken electrical motors or wiring in fridges, freezers, swimming pool pumps or washing machines
• Exclusions that usually come as a surprise include items you own but are not stored on your property
• Expensive items such as jewellery, may need to be listed separately, as they're not covered under regular contents insurance

The opinions expressed in this article are the opinions of the author(s) and not necessarily those of Resimac. The above is general commentary only and is not advice tailored to any individual's financial situation. We recommend seeking advice from an insurance and/or a finance professional before implementing changes relating to your finances.