On the flip side, those who go through a catastrophic event where they lose their contents and/or home and don’t have insurance, wish they did after the event.
As @PhilT has mentioned, it is about risk and what one is willing to accept.
Houses and their contents are expensive to replace if they are completely lost, and while the probability of such losses are low across the whole housing sector, it exists. One has to weigh up whether this probability is acceptable compared to the price of an insurance premium.
If one choses not to have insurance, they also need to accept the whole risk of not having insurance and not expect support/bailouts from governments or other organisations when a catastrophic event occurs.
‘Act of God’ is a common Insurance Term. It is usually qualified by which Acts of God are included in the policy and or excluded.
Flooding is commonly covered in home insurance. There are some important details describing the cause or how it may come about to consider, especially if you are near the sea or an estuarine area. Also exceptions for extreme or high risk sites, and higher premiums for properties in potential flood zones.
You might like to look here to add to your knowledge.
I suggest adding Budget Direct to home and contents insurance comparison
I’ve just tried using the Choice Home and Contents reviews to compare policies. I currently insure with Budget Direct, and my renewal is less than half the cost of the cheapest funds listed by Choice for NSW. They are a major player in the insurance field, so why have they been left out? I think Choice members are missing out on getting a recommendation for a good value policy as a result.
I have moved your post into the topic about reviews of Home and Contents Insurance.
Please be reassured that recommendations are taken seriously by CHOICE, and I’m sure your’s will be passed onto the Team in CHOICE that undertakes the reviews.
Budget Direct is a Company underwritten by it’s Parent Company Auto & General Insurance Compant Ltd that is a subsidiary of Auto & General Insurance that was founded in Sth Africa from what it appears. Some further Insurance Underwriting of some of the policies is undertaken by 1Life Insurance Limited.
In the past some companies and their policies have been omitted because they declined to provide data to Choice. @BrendanMays, @dangraham might that be the case here?
I have lived in a number of communities where people with no insurance have had house fires resulting the loss of all off their possessions, and home. Interestingly, there were massive fund raising campaigns, both through social media, and local events etc to raise money to replace their belongings. While I acknowledge sentimental items can never be replaced, regardless of who foots the bill, it seems in my experience, there is no financial risk to not having any insurance - someone will raise the money for you.
There are certainly instances (one off) in a community where everyone pitches in. Is this always the norm? What happens when a large portion of the community is lost to a fire, a flood or a cyclone?
When thousands of homes are lost or seriously damaged, the bill is in the hundreds of millions or billions of dollars.
Insurance shares the cost and the risk over the whole community. Whether it does so fairly or equitably is open to discussion.
There are older properties that were built in what were safe areas, that are becoming higher risk. There are newer properties that have been allowed to be built or rebuilt in high risk areas with no thought for the consequences. Many of those are expensive or impossible to insure. It seems hardly fair to expect the local community to be the ones to dig deep when these properties are lost or damaged?
Not insuring when one could!
It might be seen by the greater community as avoiding ones responsibilities.
My experience having had mortgages on a few homes over the years is that the lender will require you to have at all times suitable home insurance. It is not an option you can decide for yourself.
Now of course once you own your home and owe nothing to anyone, then you can choose to do without insurance. But typically the premium per year is a very small amount compared to the potential loss if the unthinkable happens.
There’s a saying. If your home burns down, then you are on your own. If the whole street burns down, then the Government will come running with help.
We have today received our home and contents insurance renewal from our broker. They advised that the insurer we were with (Custom) is “withdrawing from the market” and suggested an alternative insurer (Blue Zebra - underwritten by Youi). Last year’s premium was about $1700, the new proposal is $2700 - and other alternatives offered ranged from $4200 to $5000+ We have never claimed on house or contents in over 20 years. The explanation for the increase is an across-the-board increase as a result of last, year’s bushfires, hailstone storms, floods, etc. I can understand some increase, but 60% to 300% sounds way over the odds.
We are not convinced that the broker is earning their fee - when I asked if the suggested alternatives would give us the same level of cover I was advised I should read through the policies myself.
Have other people had similar experiences with massive premium increases?
I merged your topic into this existing one as it is germane.
While this older topic is about professional indemnity insurance, it touches on brokers and may thus be interesting.
From my vantage point reading your post it seems obvious they are order takers rather than brokers. I would not bother ringing them back if they are that lazy and disinterested in advising you to get their commissions.
As more and more insurance customers are discovering to their chagrin, past loyalty and lack of claims is not the help to better premiums it once was. Each policy year has become an event unto itself. Furthermore, in parts of the country where there have been floods and fires over the past years all properties are affected by increases, so an ‘across the board’ is not necessarily an unreasonable explanation even at 60+%.
Where in Victoria are you located? Perhaps other members from your area can add their own recent experiences?
I fully intend to - the broker claims that the policy offered through them is a “premium” product, not available to direct customers…but I am going to check that out too…
Thank you PhilT: helpful advice. I have a sneaking suspicion that the lower premium is to get us across to them and premium will jump next year - or the policy will be full of fine print and loopholes…
We are on the Surf Coast, about 5 minutes drive from the new suburbs of Geelong - no fires in known history here, and as we are up on a sand dune, flood highly unlikely. Would love to hear if anyone else has similar or different experiences.
After running our businesses for some 20 years before selling them some 20 years ago, we only found out in retrospect that our insurance broker had been robbing us blind.
I would not trust an insurance broker half as far as I could throw them.
The former will be an annual event, and the latter is unfortunately expected. You might be interested to know Choice has been somewhat successful lobbying for standard definitions for what ‘flood’ and ‘fire’ mean! All underwriters did not treat the terms equally. Introductory topics by Choice’s CEO and Choice Staff –
