New Zealand is pretty much surrounded by disasters waiting to happen - from earthquakes, floods and slips, extreme cyclones, and, as we now know from Nelson Tasman, Australian-scale fires.
While you’re prepared for an emergency with survival and escape kits, often the long-drawn out post event mop-up that can be just as traumatising - including wending through insurance claims.
One of the work streams in the 12 National Science Challenges, Resilience to Natural Hazards, is looking at how people prepare. Victoria University of Wellington researcher Lauren Vinnell found that very few people have specifically and purposefully purchased insurance in order to be protected in the event of a natural disaster.
"Our [study] participants from Wellington had lower intentions to purchase disaster insurance and saw it as being one of the least effective options to prepare themselves for a disaster,”she says, adding that EQC and Insurance Council New Zealand argue (correctly) that this isn't an accurate reflection of the actual rates of insurance coverage, although it gives a rough indication of how many people are properly considering whether or not they're covered.
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But, according the ICNZ, the angst can often grow when people discover that they are under-insured - often because they simply had no idea what they actually had in their house. The council doesn’t keep industry-level stats on how well people have inventoried their home contents but note that with recent disasters top of mind, it is important to understand what your home contents insurance covers, and make a thorough inventory.
Check whether your insurance is a full indemnity cover, that is, one that is based on what it would cost to purchase the item today (it may allow for some depreciation, based on age) where essentially the insurer puts you back in the same position. Replacement cover, on the other hand, replaces the item with a new one (or repairs to as new) within some limits. But a policy covers only to a sum insured limit - and if you’ve miscalculated that, you could miss out.
It’s a boring job, but worth doing now so there is one less trauma after a disaster when you can be so stressed that you just can’t remember what you lost.
1. To start, ask your insurance company or broker for a free checklist or search online. While they won’t include everything in your place, a room by room guide is a good prompt. Don’t just focus on the precious jewellery or expensive digital gadgets: things are cheap to replace, but add up dozens or more individual items and you can easily be up to hundreds or even thousands of dollars.
2. For a quick overview, start with start with a video recording, making a good documentary sweep of each room in the house. Don’t forget garage or garden sheds with valuable tools, bikes and garden accessories. Zoom on the biggest items - furniture, window coverings, special light fixtures, art, major appliances or equipment- then open cupboards and drawers to establish all of the contents in the house.
3. Jot items on the checklist as you go, review the video later to complete your notes. You may need photos of a special collection to prove to the assessors your estimates are not excessive.
4. Record the details of make, model, serial numbers, add purchase dates and prices if you still have receipts. While very expensive pieces of jewellery or equipment itemised on the insurance contract already require certified valuations, document lesser items such as irreplaceable art or collectables (makers marks or distinguishing features that confirm authenticity). If you have no receipts, this is the only way to prove the item existed.
5. Keep copies of the list somewhere not in your home or laptop - in the cloud, emailed to yourself, or hard copies with someone off-site. Let your lawyer or your broker know where the list is and how to retrieve it. It’s not a nice thought, but if something happens to you, then it is one less thing for family to worry about.
Finally, while you are in organising-for-the-worst mode, start (or refresh) your home emergency kit including copies of important documents such as ID, insurance and financial information.
