Property Insurance has several different names in the insurance industry. Depending on your insurer it can also be known as Fire and Perils cover or Material Damage cover. But regardless of the name, it covers the material items of your business such as buildings, contents, stock, plant and machinery, customers’ goods and goods in your care, custody and control. The policy normally covers perils such as fire, lightening, explosion/implosion, destruction or damage caused by aerial devices, natural events like earthquakes, storms, cyclones, floods, storms, rainwater, wind, hail, snow and bushfires.
There are often variations between insurers on the specific perils covered and their basis of settlement. This makes it imperative to seek advice from an insurance adviser to review the following key considerations when placing property cover:
- Has the occupancy and use of your premises been adequately disclosed to the insurer?
- Is the sum insured indemnity or replacement value?
- Is your sum insured adequate? What are the considerations in determining your sum insured?
- Is there a co-insurance or average clause? (Co-insurance or average clauses allow the insurer to reduce your settlement amount if you set you sum insured under a certain percentage below the actual reinstatement replacement value of your property. Your Confio Insurance Adviser can assist you with ensuring your sum insured is adequate.)
- Will having obsolete plant, equipment or stock at your premises affect your claim settlement or the co-insurance clause?
- Could you build somewhere else in the event of your property being destroyed?
- What if you decide not to rebuild? How does that affect the claim settlement?
- What is covered under the definitions of Building and Contents?
- Is accidental damage covered, and to what extent?
- Does the wording allow for seasonal increases of stock?
- What if the premises are unoccupied or become unoccupied?
- What if the premises are heritage listed?
- Are directors and employees’ property covered?
- What are the extra costs of reinstatement?
- Are your demolition and removal of debris costs covered?
- Are you covered for loss of land value, and if so to what extent?
- Does your policy include catastrophe cover? Where the insurer increases the limit of liability by a pre-set percentage to cover the increased building costs associated with catastrophes, is this percentage adequate?
With so much to keep in mind, Property Cover can be more complicated than it initially seems. The best way to navigate the options and ensure you’re fully protected is to speak with a Confio Insurance Adviser today.