An alarming 80 per cent of property owners are underinsured according to data from the Insurance Council of Australia. There are many home owners and investors that are unaware that they may be underinsured. It is important to regularly review your insurance policies to ensure that you are adequately covered, and the policy terms are still the same.
When reviewing your cover consider the following:
Building cover – Do not include the land value in the insured amount.
Have you made any renovations, alterations or additions to the property?
Know the current replacement building cost, reflecting the costs involved in restoring the property to its existing condition, considering current building standards and codes, and factoring in rising costs due to inflation.
Contents cover – Have you added to your possessions, fixtures and fittings?
Landlord cover – Has the way you rent out the property changed?
Ensure the insurance covers the lease type.
If rent has increased significantly, you may need to contact your insurer and discuss if this affects your policy in any way?
If disaster strikes, landlords can find themselves in financial trouble if they have failed to update their insurances. Take the time now to review your insurance cover.