Understanding your Sum Insured.
Knowing the total cost to rebuild your home can be difficult. So, we’ve gone into detail to give you a better idea of what your Sum Insured is, and how to calculate it.
What is your Sum Insured?
What is your Sum Insured?
When you first take out house insurance with us, we’ll ask you to specify the total amount you would need to rebuild your home to the same quality – this is your Sum Insured. It’s the maximum amount to be paid (with any applicable excess(es) deducted from that amount) if your house is damaged by an insured event like a natural disaster, flooding or fire (subject to any exclusions set out in the policy document). It not only needs to cover materials and labour, but other costs to rebuild your home like demolition, removal of debris, consents and other fees.
Keeping it up to date.
It's your responsibility to set the Sum Insured when you apply for insurance and review it whenever you renew your policy. Your Sum Insured will be automatically adjusted on renewal but this doesn’t include any additions you may have made to your property, nor will the adjustment necessarily reflect the actual change to the rebuild cost of your home (if any). You know your home best and it’s important you keep your Sum Insured up to date, so you’re not caught short. You can review and update your Sum Insured at any time by contacting us on 0800 809 378.
What Sum Insured is
- The estimated maximum amount it would cost to repair or rebuild your home if it was damaged, including any retaining walls and other features such as swimming or spa pools, tennis courts, patios, driveways, and bridges (provided those retaining walls and other features are covered under the policy document).
- An amount that covers materials and labour as well as costs like demolition, removal of debris, consents, and other fees.
- An amount you need to choose, review regularly, and tell us if you need to make any changes.
What Sum Insured isn't
- It's not the rateable value (RV) or capital value (CV) of your home.
- It’s not the market value or the price you paid for your home.
- It's not the value of the land.
- It doesn’t cover certain features on your property like bridges or culverts with a replacement cost of more than $15,000 or jetties, unless we’ve agreed to add these to your cover (please see the policy document for information on other excluded features and limits).
Why an accurate Sum Insured is important
- If your Sum Insured is too low, you may not be able to repair or rebuild your home to the same size and quality. You could also find yourself paying for some of the repairs or rebuild yourself. So, it’s really important to get it right.
Working out your Sum Insured.
It’s important to regularly review your Sum Insured and the Cordell Sum Sure calculator is a good place to start. All you need to do is enter your address and the calculator prepopulates itself with information about your property.
A broad range of factors is relevant in setting your Sum Insured, including:
- Fixtures and fittings (i.e. baths, toilets, ovens, heat pumps)
- The floor area of your home
- Fixed floor coverings (like carpet)
- Demolition costs
- Council consents and other professional fees
- Labour costs
- Land slope
- Construction materials
- Quality of materials and finish
- Number of levels
- Your home's design: (e.g. villa, bungalow, contemporary or one-off architecturally designed)
- Outbuildings such as detached garages and carports, granny flats
- Driveways, decks, paths and fences
- Underground and overhead services
- Rising building costs (i.e. inflation).
Make sure you include recreational features (such as swimming pools and tennis courts), retaining walls, and other domestic improvements of a structural nature which are permanently fixed or installed within the residential boundary of your home.
Ask a professional.
You can also get a professional, such as a registered property valuer or a quantity surveyor to assess your property. This is recommended for large (over 500sqm), high value (over $2m) or architecturally designed homes. Construction Cost Consultants can provide residential valuations at a competitive price for Westpac customers. Contact them below:
Alternatively find other registered professionals such as:
Cordell Sum Sure calculator – helpful information.
- If your address can’t be found and it includes a unit number (e.g. 23a), try different variations (e.g. 1/23, 23/1).
- If your address still can’t be found, Cordell Sum Sure calculator may not have details of the property, it may be a new subdivision or the calculator is not suitable for the property at that address.
- Don't worry if the photograph doesn’t match your house. The photograph might be different (e.g. your house is brand new, or there is an old photo, a boundary photo or street front photo) but the property details are based on the address not the photo.
- The calculator assumes an average floor area for any garages, sheds or pool houses, so if you have a particularly large detached building you might want to select a Sum Insured higher than the estimate the calculator provides.
- If you’re in the Canterbury area and your property has been identified as having a CERA technical category rating (foundation requirements), then an allowance will have been made for this. This is indicative only and you should seek specific engineering advice for a reliable estimate of any costs.
- The calculator uses typical building costs for standard finishes to provide an estimate. If your home has significant special features and fittings, was built to a superior standard, is very large or has a high value, consider using other options to establish a better estimate of the rebuilding cost, such as a registered property valuer or quantity surveyor, or select a Sum Insured higher than the estimate the calculator provides.
- Factors such as the slope (steepness) of your land, the style and quality of construction are important to get right when using the calculator. Ask for advice if you’re unsure what to enter in the calculator.
- Owners of cross-leased properties need to consider how to cover shared assets such as driveways, fences and retaining walls. Check your property's Title documents for reference to a 'plan of flats' (or similar) that sets out the various areas the cross lease applies to, and if you're still unsure, talk to your legal advisor.
- Body corporates must consider all the units in their multi-dwelling property as well as any common property.