My house & contents have increased by nearly $400 this year. The company says that we all have to pay for the cyclone up north. Does anyone else have this problem. So far, have tried 3 other companies but they are no better.
Thanks for letting us know @robyn_taylor60 and sorry to hear about the additional expenses. There is not much you can do except to shop around and make sure you are covered, in some cases you might need to negotiate or speak to an independent insurance broker.
One argument I have seen resurface recently is that we need to spend more effort on disaster mitigation to reduce premium costs.
Surely the insurance compaNiels must factor in that these properties are IN A CYCLONE-PRONE AREA? My understanding is that properties in such areas already attract higher premiums!
My insurance is not yet up for renewal, but last year I bought an investment property and so insured the building only and most of the regular insurers wanted more than $1000, so I checked with Woolworths and Coles insurance. They were just over $600 for house value of $500k. I looked up the reviews and who was actually the insurer and I did buy with them. At this time they look as good as the others and massively cheaper, although I donāt think flood insurance was included, may have been an option, which I did not need as I am high on a hill.
That would be fair if the people living in those areas build better to the weather conditions and people in flood areas moved out permanently. Instead we see poorly built house and infrastructure torn apart and another owner complaining this years flood was higher than last time. Councils shouldnāt allow residential housing in flood zones.
I agree. I rang around & got it $160 cheaper. The people I have been with for over 40 years couldnāt change their price. So much for loyalty !! Robyn.
The federal government is considering new measure to make pricing transparent and drive competition.
From the article:
āThe move could undermine a practice the Australian insurance industry has been suspected of, known as āprice optimisationā. It would involve insurers hiking prices up, not only based on the risks involved, but also based on what a big data analysis indicates they could get away with.ā
When I worked in government I learned āthe words and the cadenceā for all written anythings. It was the cookie cutter mentality. Every ātransparentā disclosure follows a similar regimen. āOur insurance product is one of the most cost effective, efficient, and all encompassing on the market. It will cover your losses as long as you have original receipts to prove your losses. When you provide your receipts we will reimburse you for up to 50% of depreciated value.ā No policy will be less than cost effective, efficient, and all encompassingā. It will end in a template that can be misleading or meaningless.
I submit that ātransparencyā is no substitute for āwell regulatedā regardless of how that regulation is accomplished, excepting self-regulation has been proven to be highly effective for those being self-regulated, and ineffective for everyone else.
To wit:
With ātransparencyā as the benchmark the NBN is going well because they will come clean on the speeds you can achieve and receive. ( You know you will only get 56kbps and because you know it, all is fine. )
With ātransparencyā card interest rates of 21+% are fine because it is clearly shown, even though we are at historical lows for everything coming to us. ( OK, this one is international and no government has taken on the banks, but at least some admit it is troublesome. Others like ourās advise us to shop around for the best card, as if we donāt know we should. )
I did not mean to pick on those two issues except to make the point. Every time I hear about a plan to āfixā something by making it more transparent and nothing more my eyes just roll.
This was extremely timely as our building insurance is now due. So I rushed on over to see if there was anything better on offer than our current insurer.
So as someone looking for information relevant to us, I found the results display left a lot to be desired. Excuse me if I get this wrong as I am merely a user of insurance, so this is from my understanding only:
The use of the term home when it actually talking about the building is confusing. (Home is a generic term to differentiate if from business). Building_ insurance and contents insurance is available for home insurance_. My understanding is that ābuildingā insurance covers the structures and fixtures. Removable fittings and all other things that you have in the building go with ācontentsā insurance.
The filters didnāt allow me to select just one of either building or contents, and there doesnāt appear to be any indication that you can select only one component in the policy.
The opening sentence āWeāve reviewed 53 home insurance policies from 29 insurers to help you find the best cover for your building and contents.ā is ambiguous and doesnāt clarify this. So I can only assume that this review only covers policies where you have to have both building and contents insurance with the one insurer.
I would have thought that āsum insuredā would be an essential filter (coupled with being able to select either building or contents, or both). There is no point looking at policies that wonāt cover the value of the property (either building, or contents, or combined) you want to insure. With the rising value of homes it is increasingly difficult to find insurers who will provide cover what are called high value properties, but are actually pretty average homes.
The complaints component was apparently not weighted in the scores. The policy with the highest score and recommended also had the highest % of complaints referred to the FOS. Surely, itās not enough to have a cheap policy with features; you want to be sure that you select an insurer that will pay out without a fuss when legitimate claims are made.
In conclusion, I am very disappointed finding this review cannot assist me in determining whether there are better policies out there or not.
Thanks for the feedback and apologies that our review wasnāt useful to you. Iāll be sure to pass this on for consideration and weāll see if we canāt improve in the future. Iām also happy to help out with the above questions and any follow ups that you might have in a more specific way, so that we can attempt to give you the info you need.
In regard to the terminology, yes totally agree with you that the word āhomeā is a bit weaselly. Itās been part of the industry lingo for as long as I can remember, so itās more a case of us following the market parlance rather than anything else. Perhaps we can make this clearer on our site though.
Appreciate your feedback on the filters as well, weāll see what we can do. The review does cover all different types of policies, but some filters would really make this easier to see rather than going through the ācompare allā page. There is a sum insured filter on the left hand side though, you can also choose ātotal replacementā or add in some building safety nets.
The complaints component accounts for 20% of the score, so it is factored in. We feel the policy details are a key factor because this should ultimately be the legally binding contract that dictates how cover you will receive in the event you ever need to claim. Having said that, thereās absolutely a critical āserviceā factor and that can really make or break the value of the insurance, so the structure of that weighting is something for us to consider.
Happy to discuss the details if you have questions about a particular type of policy or if you were weighing up between the options. Let us know how you go with it all
The bottom line seems to be that it is too hard for consumers to understand the pricing structures, not to mention the T&Cs and PDSs, so they stick to the same insurer.
Industry self-regulation and supposed competition just donāt seem to be working. Therefore this is another industry where it is way past due for the Government to step and in impose consumer-centric reforms.
ABC News provided an article by Alan Fels that was originally on āThe Conversationā (I have supplied the link to the original article) that discusses the hidden cost (well not hidden but not offered as they are to new insurers) that long term renewers of policies are paying. Mr Fels in the research found that the difference in cost is 34% greater on average for a re-signing user than the amount of the policy for a new user.
Maybe worth a Shonky as well as some CHOICE investigation.
That depends. Just having gone through the annual shopping process I found most alternatives to my present cover are more although one that is about 25% less provides less cover and from an underwriter with a statistically significant worse claims resolution experience. YMMV. And it is not just about price.
I am trying to compare Insurance companies and have come to the conclusion based on Product Review that absolutely none of them can be trusted.
The comparison websites Canstar, Mozo etc only review based on price not actual customer opinions. Have been with AAMI for a few years but their premium increases are ridiculous. Also all of them have an inflated cost of replacement if you use their calculation tool, which then leaves you second guessing yourself.
Hi @kathy2, Iām tagging our @Finance-Campaigner group for you in case people would like to share their personal experiences to help out with your questions.
We also have a home insurance review, which looks at policy details along with data from the Financial Ombudsman Service, which shows the likelihood of a customer making a complaint about an insurer as well as the outcomes. Finally, weāve heard from consumers that getting a quote as a new customer rather than relying on the renewal slip can also reduce the premium you are offered. Hope that helps and good luck sorting it out.