AAMI House and Contents Insurance

[101RRS]

A couple of years ago AAMI moved away from providing a value on your house for insurance purposes and state they will repair or rebuild your house to the same standard as it was irrespective of the cost. They calculate the premium based on the description you provide of the house but at no stage do they want pics or visit to see what you actually have.

Now at the start I just accepted the principle but with all the problems with insurance companies in recent natural disasters where an insurance company will try to get out of their obligations if they can.

So is there anyone here who has been in the unfortunate position to have their house written off and be insured with AAMI under this new system - did they rebuild the house to the way it was? or were there issues. Would you have been better off with the traditional payout type policy?

Thanks

Garry

[Homestar]

While I have no experience with AAMI, this sort of policy sounds a bit suspect to me. A friend who used to be in the industry explained home insurance to me once, and after that talk, I have always kept my insurance company up to date on the value of my house, i'll try to explain, but I can't remember all the ins and outs. How do they know how much your place is worth - if they just base it on what you tell them, I can see some holes in that.

Lets say (for ease of working out the figures) that your house would cost $400K to rebuild - remember this amount also has to include clearing the block of land of the old house that may have burnt down, etc. The site cleanup costs can exceed $80K in some instances, particullay if there are septic tanks etc - the council and Epa will all get involved in this.

Anyway, say your home insurance was for only $300K, you would be $100K out of pocket, easy to work that out, and it's pretty cut and dried.

Where it gets interesting, is if your house isn't destroyed, just damaged, by fire, flood, etc. Say the damage done was $200k. You would think your insurance (for $300K) would cover it - BUT, this may not be the case. The insurance company can (and do) claim you only have insurance to cover 3/4 of the property ($300K on a $400K property) so only pay 3/4 of the damage - $150K, leaving you out of pocket for the rest.

This happens more than you would think, so every year, I provide my insurer with an up to date value of the property - including site clean up costs, gardens, etc. You will find that figure is about $100K more than the replacement cost of the house. Good insurance companies take these things into account.

Don't trust them as far as you can throw them, read the fine print, and ensure you are really covered for what you think you are...

Cheers - Gav

[101RRS]

Thanks for the good points - but AAMI do not base their insurance on a value - the promise is to restore the house to its previous design and standard - irrespective of the cost. If they do and there is no argument then all is good - but then you might not want the same style of house.

I was in the Canberra fires and the experience there was that most homes were under-insured by a big margin but when rebuilt the house was built bigger, better and more modern.

Can you trust the insurance companies to do the right thing or will there be disputes at every turn - eg my house built in the 70s was built from 1850s sandstocks - will it get sandstocks in the new house, all my windows and doors are western red cedar - will I get that or some cheap alternative - however my large balcony has substantial rot and is not safe - will they rebuild it to as new standard.

AAMI just say of course all will be restored but I not sure.

Garry

[Homestar]

Yeah, I see what you mean. Not sure what they would do. I still can't work out how they could replace it if they don't have a value, or accurate information on what is already there. Would I trust an insurance company that says they will trust you on your description - absolutely Not...:p

[blackbuttdisco]

Amy looks attractive enough but from previous experience with car insurance, I will not go near them again.

[roverfan]

Just on the natural disasters thing, most insurance companies actually pay out allot more than they are required to and some go out of their way to pay claims that should by all rights be knocked back.

[neil 90]

Just on the natural disasters thing, most insurance companies actually pay out allot more than they are required to and some go out of their way to pay claims that should by all rights be knocked back.

can you give us some names? we got reamed on our business insurance during the floods. had a lot of cover , interuption, equipment breakdown etc but because energex cut power to the cbd "for preservation of life" that voids everything. we just carry the legal requirement now and look after ourselves with the rest. wouldn't trust em as far as I could throw em.

[101RRS]

So I take it that no one who has this type of policy and had to claim?

Cheers

Garry

[roverfan]

can you give us some names? we got reamed on our business insurance during the floods. had a lot of cover , interuption, equipment breakdown etc but because energex cut power to the cbd "for preservation of life" that voids everything. we just carry the legal requirement now and look after ourselves with the rest. wouldn't trust em as far as I could throw em.

Sorry mate cant help with business, only ever worked with personal products.

[It'sNotWorthComplaining!]

So I take it that no one who has this type of policy and had to claim?

Cheers

Garry
Garry, I switched to AAMI as my premiums went up treble with Suncorp.
I switched after my mates house was hail bombed,his colour bond roof was pitted.
AAMI asked him to get a quote and then they sent their own quoter out.
My mate had a quote for his house. The Aami guy said' What about the workshop garage roof?. ( This was second hand scabbed from demolisons) what about the roof on the garden shed?, the laser light on your BBQ , what about the chook shed roof?
My mate built all these from scabbed materials. AAMI said would he like their tradie to fix it or organise his own.
They gave him a cheque for $45,000 a week later. He fixed the house roof himself with new sheeting as he had build the extension and roof himself prior, and pocketed about $20K:D

[p38arover]

Resurrecting an old thread from the dead.

We have just received our AAMI insurance car, motorbike, and house policy renewals.

For the bike, I stayed with AAMI as Shannons was much dearer.
For the Forester, we stayed with AAMI as Shannons was $250 more, Allianz was over $100 more, APIA was $70 more. Blue Badge (insures people with a mobility sticker, etc.) was $100 less than AAMI but I can't find any positive reviews where someone has made a claim.

But the house insurance is the biggun! We had a claim last year after a hailstorm which resulted in new polycarbonate panels on the garage roof and two new TV antennae (up on a 6m guyed mast). Excess was $400.

Our policy has risen (possibly also influenced by claims after all the bushfires) from $1,555 to $1,841 for house and contents. We are covered for flood damage. The house will be covered for $508,200, it was for $462,000 last year - I'm not sure why as a new and better house than ours would cost under $200,000. If we sold, we'd probably get in excess of $800K

I just got a quote from NRMA and it was for $8,061 because we are now in a flood zone. Actually, govt mapping shows our house which is on piers, would probably be OK. Even my garage might be OK. Flood waters would be at the bottom of our street.

I'm not sure that it's worth bothering with more quotes. However, I'd like to know how they estimate that value for the house insurance. If we were rebuilding, I doubt we'd want the same design house. :)

[DiscoMick]

Resurrecting an old thread from the dead.

We have just received our AAMI insurance car, motorbike, and house policy renewals.

For the bike, I stayed with AAMI as Shannons was much dearer.
For the Forester, we stayed with AAMI as Shannons was $250 more, Allianz was over $100 more, APIA was $70 more. Blue Badge (insures people with a mobility sticker, etc.) was $100 less than AAMI but I can't find any positive reviews where someone has made a claim.

But the house insurance is the biggun! We had a claim last year after a hailstorm which resulted in new polycarbonate panels on the garage roof and two new TV antennae (up on a 6m guyed mast). Excess was $400.

Our policy has risen (possibly also influenced by claims after all the bushfires) from $1,555 to $1,841 for house and contents. We are covered for flood damage. The house will be covered for $508,200, it was for $462,000 last year - I'm not sure why as a new and better house than ours would cost under $200,000. If we sold, we'd probably get in excess of $800K

I just got a quote from NRMA and it was for $8,061 because we are now in a flood zone. Actually, govt mapping shows our house which is on piers, would probably be OK. Even my garage might be OK. Flood waters would be at the bottom of our street.

I'm not sure that it's worth bothering with more quotes. However, I'd like to know how they estimate that value for the house insurance. If we were rebuilding, I doubt we'd want the same design house. :)Did you try Youi?
Also, why don't you change your house insurance to a replacement figure?
Have you tried bundling the whole lot and seeking combined costs?
We found Youi cheaper individually, but when bundled RACQ gave the best deal.

[p38arover]

I've not heard anything good about Youi.

[DiscoMick]

I've not heard anything good about Youi.Youi were cheaper because they asked more questions to establish the use of the vehicle. We didn't go with them, so I can't comment on their treatment of claims.

We just redid our house insurance and noticed the sum insured had gradually crept up every year, because then they can charge you more.
We did some checking about the likely cost of rebuilding our place, added a margin for extras, reduced the total insured a bit and saved some money.
Another option is raising the excess you would have to pay first, which can then reduce the premium.
Have you considered trying an insurance broker to see if a better deal is possible?
Insurance companies rely on most people just passively paying up and not shopping around for a better deal.
My wife loves bargaining and every time she does it, they are able to offer significant savings to keep your business.

[Roverlord off road spares]

All th individual insurance companies are owned by the same parent groups.
We were with racv and a leak in the shower did damage they sent the assessor and they would cover it, the assessor told us other insurance companies would have. On renewal we changed. Been with Suncorp, AAMI, CGU, and now with Shannons for everything.
re pricing it depends on location and circumstances and how many claims are in your area.
What is a good price for one person might be different to another persons quote.
As for youi, they ask questions and lots of people I speak to give them a miss as too dear.

[DoubleChevron]

The main thing is take photos over EVERYTHING ..... if it burns gets partially destoryed somehow ... or you get everything stolen or flooded. You WILL forget half the stuff you had in there. The insurance company will demand valuations and receipts for everything to "prove" it existed and its value.

About 2years ago we had a hose freeze and split in the roof of our house. We were away at the time. The house flooded from the top down.... we estimate for 3days. Once alianze had listed us as a full claim and we had a claim manager.... the process become easy. We were still out of the house for 6months. they put us up in a fully furnished rental house for about 3months. Steamatic in Ballarat made everyhting easy for us. They pushed and prodded the insurance company and forwarded demands of what we needed.

In the case of a disaster... I'd be pushing for a full payout upfront and handle everyhting myself. You see EVERYONE in the area is going to be in the same ****. Your insurance companies hands will be tied. There will be no available builders, no available accommodation ....

So take photos ... millions of photos .... don't forget all the useless stuff (you would never think of) like the boss womens jewelry etc. take photos of any receipts you may have. In your shed. If your like me you will have been accumulating tools and "stuff" since you were 15years old. You will NEVER remember what is missing or not replaced until you go to use it. take photos ... thousands of the store the photos off premises. if your burnt or flooded, they will likely be lost). Upload them to a "cloud" if you can.
If you can prove something exists and is gone to your insurance company. You are set.

They WILL replace new for old... if you have exotic hardwood window frames and stuff like that .... take photos of it. The insurance policies are like for like. You MUST be insured enough to replace these though. They probably add no market value to your house, but to replace them will cost tens of thousands.

fun right. I must do everything I suggest above someday [bighmmm] [bigrolf] (gee's I'm bloody hopeless). I have a feeling we may be way under-insured :(

[3toes]

When looking at the value of the house you also have to factor in the cost of removing the damaged structure and making the site ready for the builders to rebuild. This can be surprisingly expensive