Why insurance? Sometimes people question whether or not they truly need insurance. The bottom line is, if you own, rent, or manage any kind of property, insurance must be a vital part of your life.
In the best possible circumstances, insurance will only ever be preventative. You may never need to make a claim. Does this mean your premium payments have gone to waste? Absolutely not. There’s nothing that can replace the peace of mind that you and your assets are protected if the unexpected occurs.
To put it plainly, insurance is a necessity. But how much do you need? A shocking number of Australians are underinsured, which means they do not have the proper level of coverage. In a disaster, this can spell financial ruin. To make sure you’re appropriately insured, whether as a home business owner, consider these 5 ways to avoid underinsurance.
1. Make sure you insure the rebuilding value of your properties, not the market value.
You might be surprised to find out that your home or building’s market value is not equal to the cost of rebuilding in the event of complete destruction. Rebuilding costs often considerably higher than the market value of the property, but when the wrong value is used in the policy, you have a recipe for underinsurance trouble. You should have a professional valuation of your buildings completed every few years (three is recommended). Rebuilding will not only include materials, parts, and labour, but will involve professional fees, architectural costs, business interruption, and more. It is vital that your sum insured and maximum indemnity period for business interruption are accurate figures that will keep you covered.
2. Consider other parts of your property.
Your property is not only the primary structure, but includes other areas as well. Parking lots, fencing, foundations, or any other interior or exterior property elements need to be covered as well. When you are selecting a policy, it will be necessary to be certain that your coverage includes these areas.
For parts of your property not included in this type of insurance policy, you may need to consider additional coverage. Contents Insurance may be right for you. This generally covers items within the property such as electrical equipment, appliances, and personal effects, and can include open air items as well, such as BBQs, picnic tables, or recreation equipment.
3. Protect your valuables.
If you own items of considerable sentimental or monetary value, you can prevent underinsurance by expanding your coverage. Valuables Insurance or Portable Contents Insurance are similar policies which can cover the belongings of value you own. These things may be mostly in your home but often carried with you. This might include jewelry, furs, laptop computers, works of art, and antiques. You can assess your items by creating a detailed inventory to discuss with your insurance broker. It is important to be sure these pieces are fully covered, in case the unexpected occurs.
4. Let your insurer or broker know when you make changes to your home or business or purchase additional items of value.
The value of your property is subject to constant change. If you own a business and you make a significant update or remodel, this will alter the building’s value. Adding a new bedroom to your home? Installing a backyard swimming pool? It all changes the market value and rebuilding value of your property, and thus changes your insurance coverage. When you purchase a new item of value or make a substantial alteration to your property, be sure to contact your insurer or broker so that the proper adjustments can be made. Failing to do this could result in serious underinsurance issues.
5. Work with an experienced and professional insurance broker.
Perhaps the most effective way to avoid underinsurance for your home or business is to work with a qualified broker. When you partner with an expert in the field, you’ll feel confident that you are getting the absolute best products for your needs. Our team of brokers knows insurance inside and outside, and they know how to assess your specific circumstances and find you the right level of coverage. With Macey Insurance Brokers, you don’t have to worry about underinsurance. We’ll help make sure you are covered fully and appropriately.