Home insurance

[KeithP]

Good point Ian.
My planes are mostly Veritas, which were obviously bought over a time frame of about 7 years. (and still likely to buy more)
I think you have summed up the insurance situation. I have always felt it unwise to under insure, but it would be equally unwise to over insure by too much.
Finding the right balance is not always straight forward. I am now comfortable with the insured values of around $400K.

Thanks for your input Ian, it is most appreciated.

Keith

[Chris Parks]

Hi Keith

Don't forget to put a reasonable valuation on your tools.

In the event of a tool claim the biggest problem will be remembering everything that was there so an inventory is essential.

[Bob38S]

In the event of a tool claim the biggest problem will be remembering everything that was there so an inventory is essential.

Easiest way to achieve this is to photograph all of your items. These days with camera phones, tablets etc it has never been easier. Copy the pix onto 2 usb sticks, why 2, keep 1 at home and keep the other at a relative's house. Should you have a total loss the offsite stick provides the proof you will require for insurance purposes.

This method also works well for any valuables you may have.

Just a thought.

[WicklowWood]

So Keith
If you built it yourself + planning + x 1.6 = your 1st offer



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[AlexS]

In the event of a tool claim the biggest problem will be remembering everything that was there so an inventory is essential.

Easiest way to achieve this is to photograph all of your items. These days with camera phones, tablets etc it has never been easier. Copy the pix onto 2 usb sticks, why 2, keep 1 at home and keep the other at a relative's house. Should you have a total loss the offsite stick provides the proof you will require for insurance purposes.

This method also works well for any valuables you may have.

Bob took the words out of my mouth. Did exactly this, and put everything into a spreadsheet, with purchase date & price if known, plus replacement cost. You may be surprised at how much it adds up to.

An interesting thing was that for many of the hand-held electrical tools, the cost of the current equivalent model is less that the cost of the original 20-30 years ago.

[tonzeyd]

This topic appears to be sufficiently covered, the only other thing i'd add is what someone else has mentioned. Your coverage should reflect your risk appetite and unless you're in high risk areas such as those in cyclone, hurricane, bush fire, or flood areas. Chances are your home insurance claims will come from storm damage, electrical faults causing fires or burglaries. In which case you'll be very unlucky if you suffered a total loss in either those scenarios. So it now becomes a game of chance, do you cover 100% of all your valuables/assets in the unlikely chance that you may suffer a total loss, or do you cover X% of your valuables and if in the event you do suffer a loss the savings over the years of not having full coverage covers the losses you experienced. Hope that makes sense.

Also the spreadsheet/photograph idea is highly recommended, not only to help you calculate your replacement cost of your valuables but also as a proof of ownership. Which your insurer will ask in the event of burglary.

[Chris Parks]

I did both Spreadsheet and photographs because I have an extensive collection of mechanics tools with many duplicates which a photo alone will not detail. It has been many years since I have bought any spanners etc and I was absolutely gob smacked at the prices now being charged these days.

[ian]

This topic appears to be sufficiently covered, the only other thing i'd add is what someone else has mentioned. Your coverage should reflect your risk appetite and unless you're in high risk areas such as those in cyclone, hurricane, bush fire, or flood areas. Chances are your home insurance claims will come from storm damage, electrical faults causing fires or burglaries. In which case you'll be very unlucky if you suffered a total loss in either those scenarios. So it now becomes a game of chance, do you cover 100% of all your valuables/assets in the unlikely chance that you may suffer a total loss, or do you cover X% of your valuables and if in the event you do suffer a loss the savings over the years of not having full coverage covers the losses you experienced. Hope that makes sense.

Also the spreadsheet/photograph idea is highly recommended, not only to help you calculate your replacement cost of your valuables but also as a proof of ownership. Which your insurer will ask in the event of burglary.

of you down this path you need to very carefully read the details of your policy every time you renew it.

some insurers treat the scenario you describe as under insurance. You insure for 70% of the value, you suffer a 50% loss, the insurance company only pays out 35% (70% x 50% = 35%) leaving you with a 15% gap.

[Enfield Guy]

I believe over insurance can have a similar effect.

[tonzeyd]

Yep thats correct, over insurance is a waste of money as your insurer will never pay that full amount you're paying for.
Under insurance isn't an issue unless you can't afford to pay the gap, therefore its important in particular to building insurance not so much with contents insurance. IMO there's no point insuring every single item you own in the event of a total loss, value your big ticket items like machinery, tools that you couldn't bare to lose. The savings in reduction in premiums over the years could vary well cover the cost of the smaller items if you happen to suffer a loss. But as i said earlier at the end of the day depends on your risk appetite. For me I believe the potential savings is worth the effort to not get 100% coverage, as I believe the potential risk of losing everything is tiny.

[Big Shed]

Under insurance isn't an issue unless you can't afford to pay the gap, therefore its important in particular to building insurance not so much with contents insurance.

You may want to reconsider that statement

under-insurance in household insurance complaints

[tonzeyd]

Thanks, but i still stand by my comment.

The article itself is titled "House hold insurance complaints" not Under Insurance = Home Insurance Fraud, as far as i am aware there is not mandate to be 100% covered as insurance is optional, if that was the case I'd be on the phone to my insurance company daily to update them of my changes in coverage.

I don't know about your insurance company but I not aware of any insurance company to ask for a full itemised list of my contents. Therefore as far as they are aware I have properly valued my home and contents. So when I do go and make a claim, they don't know whether my $x coverage covers all my items or only a small proportion of my items. Its only in the event of 100% loss that I am exposed to under insurance and if that ever happens I know that I can just replace items that are not covered out the savings in premiums or not have them replaced if they are no longer required.

[ian]

FWIW, the insurance companies I've dealt with expect that household contents (and for that matter building features) that are outside what is considered normal should be listed on a separate schedule.
For example, if your house had one or more timber framed stained glass bay windows, these would need to be itemised, otherwise when the house was repaired, insurance would only pay for plain aluminium frames in a flat wall.

But of particular relevance to this forum, is how insurance companies value the contents of a shed.
"Normal" is a lawn mower, circular saw, drill-driver, cheap power sander, a few screw drivers and spanners, a green shed hand plane and 3 or 4 paint tin openers AKA chisels.
"Outside normal" is what you would find in a typical WW shed -- table saw, dusty, thicky, multiple sanders and drill/drivers, fettled hand planes (or LNs and Veritas versions), chisels which might have been bought for $5 to $20 each, but would cost considerably more to replace with ready to use tools, etc.

Likewise with photo gear. normal is a low end SLR with two kit lenses, outside normal is an mid to upper range SLR with multiple quality lenses. For example some of my Nikon lenses would cost 2 to 3 times the cost of a basic SLR kit to replace.


The question is, in the event of a loss do you want to get back to where you were quickly -- which would typically mean buying new quality tools -- or are you happy scouring the markets and ebay for the next 5 to 10 years searching for a set of elusive Berg chisels, or spending 2 months de-rusting and fettling a mediocre hand plane? When we moved here I had to value my hand tools at full replacement in the event the container they were travelling is was lost. My reasoning was; should the container be lost I would get no joy spending the next 3 to 4 years searching out and rehabbing replacement tools when the whole purpose of shipping them in the first place was to have them to hand to use.