Your home is probably one of the biggest financial commitments youve ever made.

Its important to protect both your loan commitment and your investment.

Replacement Policy

It is important to make sure that your home insurance policy covers replacement value. Some policies apply depreciation to certain items like clothes and computers, and to items over a certain age. Unfortunately, if a 12 year old TV is stolen, you can't usually buy another 12 year old TV - you need to buy a new one. If depreciation has been applied you will not receive enough to buy a new TV and will either have to put in extra money yourself, or buy a smaller or inferior TV.

A replacement value policy will ensure that you can get as near as possible to the item without having to contribute yourself.

The problems of underinsuring your home and contents

In the Sydney bushfires, 22% of homes were underinsured, while 60% of homes effected by the Newcastle earthquake were underinsured. All these people could not return their homes and contents to the same standard without a significant injection of money. Also, when a person significantly under insures their home or contents, insurance companies have the authority to apply depreciation to the amount they would normally pay for a claim.