Cheaper House and Contents Insurance
Insurance is one of those horrible pains in the neck. You would rather do with out it, but thoughts of fire burning your house down mean you pay up. And I recon we all have a sneaky feeling we’re getting done over! And I thinks that true. So do you really need house and contents insurance. And if you do, how can you get cheaper house and contents insurance. Having just purchased some last week, let me walk you through my thought processes.
Do You Need House and Contents Insurance as All?
In short, if you own a home, the answer is yes. But you need to know what you are insuring for. I don’t insure for a broken window, a lightening strike or any minor event. I only insure for massive damage, a tree through the roof, a fire destroying the whole home, a flood or someone leaving the water on in the bath while on holidays. Only insure for events you can’t afford. I can fix a broken window, even a small buglary. But I don’t have a spare few hundred thousand to rebuild the entire house. So that’s all I insure for. That means a few thing that help with getting a better deal.
Go For a Big Excess
Because I only care about big damage, I opt for a big excess and a cheaper premium. An excess of $1000-$3000 is nothing for a $500000+ rebuild. So go for a big excess and get a lower premium. Again it comes from knowing what you are insuring for and what you’re not.
Say NO to All the Extra’s
Do you want fries with that? Insurance has it’s own hangers on that aren’t anywhere near as good as fries. Do you want away from home insurance? Increased special items limits? Motor burnout? Guaranteed Payout? Accidental damage? Glass breakage? And the list goes on. I usually give them all a big fat NO! Each is just a small increase to your premium, but they really add up. What about that $20 000 painting you ask? The $5000 bicycle. Truth is, if you have those items, you can probably afford to lose them. If not, maybe you should trade down to something you can? So just say no to all the fluff they try to sell you.
Beware of Under and Over Insurance.
Under insurance if you listen to the insurance companies is a big thing. So now many of them have minimum insurance levels for a given sized home. That’s great, unless they are ridiculous. We built a new home 3 years ago. I know exactly what it cost for it and all the extras. If I add to that knock down rebuild costs, alternative accommodation for a year and a very generous margin. I still found they wanted to overinsure me by $100 000 to $300 000 in most cases. Do you smell a rat. Looks like another excuse by the insurers to jack up the premium for us all by mandating over insurance. Thanks for that! I ended up having to take a policy with a good $100k over insurance.
You have to do this. Insurers will up the premium on their existing customers in the hope you won’t shop around at all. Only newcomers get the best deals. So you need to be a perennial newcomer to save. There’s no easy way to do this. Aggregators, like iselect, choosi, compare the market, etc miss a lot of insurers that they don’t get kickbacks from. But they can be worth searching, along with going direct to the insurers website. You’d be surprised how different prices can be. I probably plugged my info into about 15 websites or more before making a decision. The prices had a range of over $1000 from cheapest to most expensive. I also checked out the ratings on canstar to make sure I wasn’t getting a lemon.
Look at the Fine Print
Once I got the best deal, I read through the PDS. I want to know what they cover and don’t cover. It’s annoying, but worth knowing before you sign on the dotted line. So then I sign up, right? No, one more step.
Ask For a Better Price
You can often get a better deal if you call up and ask. Let them know that you like their policy if it was just a bit cheaper. And watch the price magically decrease. Most sales people have permission to lower by a certain percentage. So make the call and then you are ready to go. If you like you current insurer, you can always call them up and ask to match the price. They might just do it, too.
Who Did I go With?
I managed to get my insurance for about $45 less than last year, not a mean feat. That was with an additional $200 000 insured value on the house. This year I moved over to Budget Direct. Their policy was also one of the top rated on canstar, with 5 stars. I can probably bank on them jacking up the premium next year. And we can do it all over again. Have fun finding cheaper house and contents insurance.
You may also be interested in how to chase down cheaper car insurance.